Investing.com - Gold prices extended losses on Thursday to hit the lowest level in nearly five weeks after data showed that the number of people who filed for unemployment assistance in the U.S. last week fell more than expected, boosting optimism over the health of the labor market.
On the Comex division of the New York Mercantile Exchange, gold futures for August delivery hit an intraday low of $1,176.30 a level not seen since May 1, before trading at $1,180.80 during U.S. morning hours, down $4.10, or 0.35%.
A day earlier, gold prices slumped $9.50, or 0.8%, to settle at $1,184.90 after a batch of upbeat data bolstered the case for a U.S. interest rate hike this year.
Futures were likely to find support at $1,168.40, the low from May 1, and resistance at $1,204.70, the high from June 1.
The U.S. Department of Labor said the number of individuals filing for initial jobless benefits declined by 8,000 last week to 276,000 from the previous week’s revised total of 284,000. Analysts had expected initial jobless claims to fall by 5,000 to 279,000 last week.
Investors now looked ahead to Friday’s U.S. employment report, which was forecast to show a gain of 225,000 jobs in May, following an increase of 223,000 in April.
A strong U.S. nonfarm payrolls report was likely to bring forward expectations on when the central bank will begin to raise rates, while a weak number could weigh on the dollar by undermining the argument for an early rate increase.
Recent economic reports have indicated that the U.S. economy was regaining strength after contracting in the first quarter, fuelling speculation that the Federal Reserve could raise rates as soon as September.
The U.S. dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, was down 0.2% at 95.16, moving off a more than two-week low of 94683 hit earlier in the day.
Also on the Comex, silver futures for July delivery dipped 16.2 cents, or 0.98%, to trade at $16.31 a troy ounce, a level not seen since May 12. Silver lost 31.9 cents, or 1.9%, on Wednesday to end at $16.48.
Elsewhere in metals trading, copper for July delivery declined 2.1 cents, or 0.76%, to trade at $2.706 a pound, the weakest level since April 24. On Wednesday, futures dropped 0.9 cents, or 0.35%, to close at $2.726.
The red metal has been under pressure in recent sessions amid ongoing concerns over the health of China's economy. The Asian nation is the world’s largest copper consumer, accounting for almost 40% of world consumption last year.