Gold Drops for Sixth Day as U.S. Data Adds to Case for Tapering

SINGAPORE (Aug 2) Gold fell a sixth day in the longest run of losses since May, heading for the first weekly decline in a month, as U.S. economic data backed the case for less stimulus.

Spot gold lost as much as 0.5 percent to $1,303.02 an ounce, and traded at $1,305.26 at 7:23 a.m. in Singapore. The Bloomberg Dollar Index, which tracks the greenback against 10 currencies, rose the most in more than a month yesterday as claims for jobless benefits fell to a five-year low.

Gold has retreated 2.1 percent this week, heading the biggest drop since the five days to June 28. Data today may show that U.S. unemployment fell in July, while employers added 185,000 jobs. The Federal Reserve said this week that it will maintain its $85 billion monthly asset-buying program and that persistently low inflation could hamper the economic expansion.

“Gold falls on U.S. dollar strength as U.S. economic data surprised to the upside,” James Steel, an analyst at HSBC Securities (USA) Inc., wrote in a note. “The gold market will likely focus on the upcoming release of nonfarm payrolls data.”