Investing.com - Gold prices bounced off four-month lows on Friday, but the precious metal remained under pressure as growing hopes for a U.S. rate hike before the end of the year continued to boost demand for the dollar.
On the Comex division of the New York Mercantile Exchange, gold futures for December delivery were up 0.14% at $1,254.85.
The December contract ended Thursday’s session 1.23% lower at $1,253.00 an ounce.
Futures were likely to find support at $1,249.90, Thursday’s low and a four-month low and resistance at $1,374.00, Wednesday’s high.
The dollar was boosted after data on Thursday showed that U.S. initial jobless claims decreased by 5,000 to 249,000 in the week ending October 1. Analysts had expected jobless claims to rise by 3,000 to 257,000 last week.
Market participants were awaiting the U.S. nonfarm payrolls report due later in the day for further indications on the strength of the job market, as the Federal Reserve has indicated that future interest rate decisions will be data-dependent.
The precious metal is sensitive to moves in U.S. rates, which lift the opportunity cost of holding non-yielding assets such as bullion, while boosting the dollar in which it is priced.
The U.S. dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, was up 0.43% at 97.08, the highest since July 27.
A stronger U.S. dollar usually weighs on gold, as it dampens the metal's appeal as an alternative asset and makes dollar-priced commodities more expensive for holders of other currencies.
Elsewhere in metals trading, silver futures for December delivery dropped 0.62% to $17.237 a troy ounce, while copper futures for December delivery slipped 0.26% to $2.150 a pound.