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Forexpros – Gold futures traded higher Thursday, despite the strong greenback, as ongoing speculation on central bank stimulus measures lifted demand for the commodity.
On the Comex division of the New York Mercantile Exchange, gold futures for October delivery traded at USD1,617.05 a troy ounce in U.S. afternoon trade up 0.20%.
Gold futures were likely to test support at USD1,608.50 a troy ounce, Tuesday’s low and resistance at USD1,625.90, the high of July 30.
Gold remained range bound amid uncertainty over if and when the U.S. Federal Reserve will launch another round of quantitative easing.
Earlier Thursday, the Department of Labor said the number of people who filed for unemployment assistance in the U.S. declined to 361,000 last week, from an upwardly revised 367,000 in the previous week, against expectations for an increase to 370,000.
A separate report showed that the U.S. trade deficit dropped to USD42.9 billion in June, its lowest level in two-and-a-half years, from a downwardly revised USD48.0 billion the previous month.
Analysts had expected a trade deficit of USD47.5 billion in June.
Meanwhile, hopes that the European Central Bank will soon move to cut high Spanish and Italian borrowing costs faded as investors waited for more details of the bank’s proposed bond buying program to emerge.
Gold remained supported after official data showed that China’s consumer price index rose at an annualized rate of 1.8% in July, slower than the 2.2% rate of the previous month, indicating that China’s central bank has more scope for monetary easing, following interest rates cuts in June and July.
Elsewhere, physical demand from India, a major global gold consumer, looked likely to remain sluggish ahead of the festival season which begins this month and runs through until November, as a result of a weak rainy season and weakness in the rupee, which pushed domestic prices higher.
Elsewhere on the Comex, silver for September delivery was flat to trade at USD28.075a troy ounce, while copper for September delivery climbed 0.06% to USD3.424.
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