Gold climbs to 4-week high after U.S. jobless claims data

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Investing.com - " Gold prices rallied to a four-week high on Thursday, as weaker-than-forecast U.S. jobs data dampened expectations that the Federal Reserve will start to taper its bond-buying program in the coming months.

On the Comex division of the New York Mercantile Exchange, gold futures for December delivery traded at USD1,343.40 a troy ounce during U.S. morning trade, up 0.7%.

Comex gold prices rose to a session high of USD1,348.90 a troy ounce earlier, the strongest level since September 29.

The December contract ended 0.64% lower on Wednesday to settle at USD1,334.00 a troy ounce.

Gold futures were likely to find support at USD1,310.10 a troy ounce, the low from October 22 and short-term resistance at USD1,350.30, the high from September 29.

The U.S. Department of Labor said earlier that the number of individuals filing for initial jobless benefits declined by 12,000 last week to a seasonally adjusted 350,000.

Analysts had expected U.S. jobless claims to fall by 22,000 to 340,000 last week.

Jobless claims for the preceding week were revised up to a gain of 362,000 from a previously reported increase of 358,000.

The disappointing data underlined expectations that the Fed will delay tapering its stimulus program until next year amid concerns over the impact of the 16-day U.S. government shutdown on the economic recovery.

Gold prices have largely tracked shifting expectations as to whether the Fed would start tapering its USD85-billion-a-month asset-purchase program by the end of the year.

The central bank is scheduled to meet October 29-30 to review the economy and assess policy.

Elsewhere on the Comex, silver for December delivery added 0.3% to trade at USD22.69 a troy ounce, while copper for December delivery shed 0.3% to trade at USD3.258 a pound.

Stronger-than-expected Chinese manufacturing data failed to offset concerns over tightening liquidity conditions in the country's banking sector.

Data released earlier showed that China's HSBC manufacturing index for October rose to a seven-month high of 50.9, up from a final reading of 50.2 in September. Economists had expected the index to tick up to 50.5.

However, sentiment remained weak amid concerns over a cash crunch in the Chinese financial system after interbank lending rates moved higher for a second day.

China is the world's largest copper consumer, accounting for almost 40% of world consumption last year.

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This article appears in: Investing , Forex and Currencies

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