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Gold prices steady in Asia ahead of U.S. holiday

November 27, 2014

Shanghai (Nov 27)  Gold held mostly steady in early Asia on Thursday ahead of a holiday in the U.S. that will shut markets, but also marks the start of the year-end shopping season that is key for demand.

On the Comex division of the New York Mercantile Exchange, gold futures for February delivery traded down $1,198.00 a troy ounce, flat, after hitting an overnight session low of $1,194.70 and off a high of $1,201.50.

Overnight, a tepid bag of U.S. indicators weakened the dollar on Wednesday by sending investors rethinking when the Federal Reserve will hike interest rates, which gave gold a shot in the arm earlier, though profit taking took back earlier gains.

The Labor Department reported earlier that the number of individuals filing new applications for unemployment benefits rose to 313,000 last week, a gain of 21,000. It was the highest level since early September, confounding market calls for a decrease of 5,000.

The number of continuing claims fell to a 14-year low of 2.31 million, indicating that the jobs market is still recovering.

At the same time, the Commerce Department reported that U.S. personal spending rose 0.2% in October, below forecasts for an increase 0.4%. Personal income also rose 0.2%, falling short of forecasts of 0.4%, which took its toll on the greenback and boosted gold's appeal before profit taking kicked in.

While many expect the Federal Reserve to raise interest rates in 2015, the timing of such a move remains up in the air, and Wednesday's data weakened the dollar by prompting investors to push back timetables later next year.

Elsewhere, the Census Bureau reported that durable goods orders rose 0.4% last month, beating expectations for a decline of 0.4%, but core durable goods orders, which are stripped of volatile transportation components, fell 0.9%, against forecasts for a 0.5% gain.

Also on Wednesday, the Thomson Reuters/University of Michigan's final consumer sentiment index hit 88.8 from 86.9 in October, though still below the preliminary estimate of 89.4.

Industry data revealed that the Chicago purchasing managers' index fell from 66.2 in October to 60.8 this month, below expectations of a figure of 63.1.

Finally, data showed that sales of new homes rose 0.7% in October to an annual rate of 458,000 units, but pending home sales unexpectedly fell 1.1% last month.

Silver for March delivery fell 0.08% at $16.543 a troy ounce. Copper futures for March delivery were down 0.06% at $2.954 a pound.

Source: MoneyControl

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