Gold futures fell for the fourth time in five sessions as U.S. jobless claims dropped to a nine-week low, boosting speculation that the Federal Reserve will increase interest rates sooner than anticipated.
Silver, platinum and palladium also declined. Applications for unemployment benefits dropped by 20,000 to 268,000 in the week ended March 28, a government report showed Thursday.
Gold on Wednesday jumped the most in 10 weeks after a private report showed U.S. employment rose by 189,000 last month, the smallest gain since January 2014, damping the prospect that the Fed would raise borrowing costs. Government data on Friday may show employers added 245,000 jobs in March, down from 295,000 in February, according to a Bloomberg survey of economists.
“We thought jobless claims would be a little higher based on yesterday’s ADP report that less people were employed, so today’s claims are good news for the economy and bad news for gold,” George Gero, a precious-metal strategist at RBC Capital Markets in New York, said in a telephone interview. “If the economy has good news, it means probably we will have a rise in interest rates sooner rather than later.”
Gold futures for June delivery fell 0.6 percent to $1,200.90 an ounce at 1:46 p.m. on the Comex in New York. The price has dropped 7 percent in the past 12 months.
Higher interest rates cut the allure of precious metals, which generally offer returns only through price gains.
On Wednesday, holdings in global exchange-traded products backed by gold posted a consecutive gain for the first time since Feb. 24, data compiled by Bloomberg show.
Silver futures for May delivery declined 2.1 percent to $16.701 an ounce on Thursday on the Comex. The price, down for the fourth time in five sessions, has slumped 17 percent in the past 12 months.
On the New York Mercantile exchange, platinum futures for July delivery dropped 1 percent to $1,154.50 an ounce.
Palladium futures for June delivery declined 0.3 percent to $746.30 an ounce.
The markets will be closed Friday for a U.S. public holiday.