Spot gold inched up 0.1% to $4,210.49 per ounce by 1833 GMT, while U.S. gold futures for February settled 0.2% higher at $4,243.00 per ounce.
“Higher yields are keeping a bit of a cap on the upside, and providing some support is the general dollar index,” said Edward Meir, analyst at Marex. Benchmark 10-year U.S. Treasury yields rose, while the dollar index hit a one-month low, making gold relatively cheaper for overseas buyers.
Economic data released on Thursday showed U.S. initial claims for unemployment benefits fell to 191,000 last week, the lowest level in more than three years and below economists’ expectations of 220,000. Meanwhile, Wednesday’s ADP report indicated private payrolls declined by 32,000 in November—the steepest drop in over two and a half years—highlighting signs of a cooling labor market.
A majority of economists surveyed by Reuters expect the Federal Reserve to cut its key interest rate by 25 basis points at the December 9-10 policy meeting. Lower interest rates typically boost non-yielding assets such as gold. Investors are now focusing on the September Personal Consumption Expenditures (PCE) report, the Fed’s preferred measure of inflation, due on Friday.
“Markets aren’t going to do very much between now and next week, and as far as gold is concerned, we will probably be stuck in a relatively uneventful trading range for a while,” Meir added, noting that gold is unlikely to retest its old highs near $4,400 this year.
Elsewhere in precious metals, silver fell 2.6% to $56.96 after reaching a record high of $58.98 on Wednesday. The metal has surged about 97% this year, supported by a structural supply deficit, market liquidity concerns, and its inclusion on the U.S. critical minerals list. Platinum declined 1.7% to $1,642.67, while palladium slid 1.4% to $1,440.57.