Investing.com - Gold prices were little changed on Wednesday, as market players looked ahead to the release of key U.S. data later in the session for further indications on the strength of the economy and the future path of monetary policy.
On the Comex division of the New York Mercantile Exchange, gold futures for June delivery dipped 60 cents, or 0.05%, to trade at $1,182.60 a troy ounce during European morning hours. Prices held in a narrow range between $1,181.90 and $1,188.80.
A day earlier, gold hit $1,178.20, the lowest level since March 20, before ending at $1,183.20, down $2.10, or 0.18%.
Futures were likely to find support at $1,168.70, the low from March 20, and resistance at $1,199.60, the high from March 30.
Later in the day, the U.S. was to release the ADP nonfarm payrolls report for March, while the Institute of Supply Management was to release data on manufacturing activity.
Investors were also turning their attention to Friday’s U.S. employment report for February for further indications on the future path of monetary policy.
A strong U.S. nonfarm payrolls report was likely to add to speculation over when the Federal Reserve will begin to raise interest rates, while a weak number could weigh on the dollar by undermining the argument for an early rate hike.
The dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, was up 0.2% to 98.90 early on Wednesday.
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.
The dollar has been bolstered by the diverging outlook for monetary policy in the U.S. compared to other major economies, such as Europe and Japan.
Elsewhere on the Comex, silver futures for May delivery shed 5.0 cents, or 0.3%, to trade at $16.54 a troy ounce, while copper for May delivery tacked on 1.1 cents, or 0.39%, to trade at $2.751 a pound.
Official data released earlier showed that China's manufacturing purchasing managers' index inched up to 50.1 this month, just above the 50-point level that separates growth in activity from contraction. Analysts had expected a reading of 49.7, down slightly from February's reading of 49.9.
Meanwhile, the China HSBC (LONDON:HSBA) final manufacturing PMI was revised up to 49.6 in March from an initial estimate of 49.2 but down from 50.7 the previous month.
Despite the modest improvement, both reports indicate economic conditions remain sluggish, fuelling speculation policymakers in China will have to do more to jumpstart the economy.
The Asian nation is the world’s largest copper consumer, accounting for almost 40% of world consumption last year.