Investing.com - Gold prices pulled away from the previous session’s five-week highs on Thursday, as the dollar regained some ground ahead of a string of U.S. data due later in the day and on Friday amid mounting hopes for a June rate hike by the Federal Reserve.
On the Comex division of the New York Mercantile Exchange, gold futures for June delivery were down 0.39% at $1,267.05.
The June contract ended Wednesday’s session 0.78% lower at $1,272.00 an ounce.
Futures were likely to find support at $1,258.40, Tuesday’s low and resistance at $1,273.95, Wednesday’s high.
The greenback recovered from recent losses posted amid ongoing fears investigations into President Donald Trump's ties with Russia could hamper his administration's progress on promised stimulus measures.
The Trump administration is under investigation by the Federal Bureau of Investigation and several congressional panels over alleged Russian meddling in the 2016 presidential election and potential collusion with the Trump campaign.
The U.S. dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, was up 0.12% at 97.03, off Wednesday’s one-week low of 96.80.
A stronger U.S. dollar usually weighs on gold, as it weakens the metal's appeal as an alternative asset and makes dollar-priced commodities more expensive for holders of other currencies.
Market participants were especially eyeing Friday’s nonfarm payrolls report for further indications on the strength of the U.S. job market, which could give additional clues on whether or not the Federal Reserve will hike rates at its June policy meeting.
The precious metal is sensitive to moves in U.S. rates, which lift the opportunity cost of holding non-yielding assets such as bullion. A gradual path to higher rates is seen as less of a threat to gold prices than a swift series of increases.
Elsewhere in metals trading, silver futures for July delivery declined 0.71% to $17.283 a troy ounce, while copper futures for July delivery slid 0.27% to $2.573 a pound.