Gold Futures Settle Lower For 3rd Straight Day As Dollar Rises

Gold futures settled lower on Thursday as the dollar continued to climb higher amid rising bets the Federal Reserve will tighten policy and hike interest rates in the coming months.

Data showing a drop in U.S. jobless claims last week, and an upward revision in first-quarter GDP growth have raised the possibility of a rate hike in July.

The dollar index advanced to 103.44 before easing to 103.30, but remains in positive territory with a gain of nearly 0.4%.

Gold futures for August ended lower by $4.30 or about 0.2% at $1,917.90 an ounce, extending losses to a third straight session, and recording the lowest settlement since mid March.

Silver futures for September ended down $0.286 at $22.798 an ounce, while Copper futures for September settled at $3.6990 per pound, down $0.0435 from the previous close.

Federal Reserve Chair Jerome Powell said on Thursday that the US central bank would deliver more interest rates hikes by the end of the year in its prolonged fight against high inflation.

“Inflation pressures continue to run high, and the process of getting inflation back down to 2% has a long way to go,” Powell said in a speech at the Banco de Espana conference on financial stability in Madrid, Spain.

Powell had said at the ECB forum in Sintra, Portugal on Wednesday that there was “more restriction coming” and successive rate rises were not off the table.

Data from the Labor Department showed initial jobless claims fell to 239,000 in the week ended 24th, a decrease of 26,000 from the previous week’s revised level of 265,000. Economists had expected jobless claims to rise to 270,000 from the 264,000 originally reported for the previous week.

A separate report released by the Commerce Department showed the U.S. economy grew by much more than previously estimated in the first quarter of 2023.

The Commerce Department said gross domestic product jumped by 2% in the first quarter compared to the previously estimated 1.3% increase. Economists had expected the pace of GDP growth to be unrevised.

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