Gold Prices Halt Losing Streak
NEW YORK ( TheStreet) -- Gold prices rose Thursday after the yellow metal pared early-session losses that had accrued because of uncertainty as to whether the Federal Reserve's would continue its highly accommodative policies past 2013.
Gold for April delivery tacked on 60 cents to settle at $1,578.60 an ounce at the Comex division of the New York Mercantile Exchange. The gold price traded as high as $1,584.40 and as low as $1,554.30 an ounce, while the spot price was popping $13.80, according to Kitco's gold index.
The Fed's January minutes, released on Wednesday, said that "many" central bankers were open to the idea of backing off monetary stimulus in 2013, but the policy-making wing didn't issue any changes in the latest statement.
The announcement came on the heels of more than a week of downward momentum in the gold market.
"We actually have seen downside price pressure in the gold market for longer than just yesterday," said Jim Wyckoff, senior metals analyst at Kitco.com, in an interview . "We are seeing technically related pressure, a stronger U.S. dollar index has added to selling pressure in the gold market. I think a lot of traders anticipated that the
Silver prices for March delivery rose 77 cents to close at $28.70 an ounce, while the U.S. dollar index was jumping 0.39% to $81.40.
Helping gold prices retrace their losses on Thursday were a rise in initial jobless claims and a midday speech by San Francisco Fed President John Williams.
The Labor Department said initial jobless claims for the week ended Feb. 16 rose 20,000 to a seasonally adjusted 362,000, up from a prior-week revised 342,000 claims. Economists expected claims to rise 355,000. The four-week moving average rose to 360,750 from the previous average of 352,750.
The Fed's unemployment rate target of 6.5% as a threshold for it to boost interest rates has suggested to gold traders that a weaker labor market makes the precious metal a safe haven. But investors may not want to read too much from the labor data.
"I think it's a bit of a non-event. The short-term numbers are all over the place and we still have the lingering effects of Superstorm Sandy," said Marty Leclerc, chief investment officer at Barrack Yard Advisors.
The Fed's Bullard said he believed quantitative easing would be needed into the second half of 2013 -- a comment that would deflect worries that scaling back of easing would come in the short-term.
"We need powerful and continuing monetary accommodation," Williams said . "Unemployment is far too high and inflation is too low."
Economic news from Europe was relatively calm, though the FTSE 100 in London and the DAX in Frankfurt both posted losses of more than 1% on Thursday. European equity market pressure followed the first trading session since the U.S. Fed revealed increased consideration of scaling back its purchasing of mortgage-backed securities and longer-term Treasuries.