Prices get a boost from less-dovish comments from ECB president Mario Draghi
Bullion prices ended higher on Thursday, 06 March 2014. Gold futures finished higher on Thursday climbing back to their highest settlement in more than four months boosted by bargain hunting and by a lower U.S. dollar index. Gold also got a lift on Thursday from less-dovish comments from European Central Bank president Mario Draghi, at his press conference following the ECB monthly meeting. His remarks lifted the Euro currency, which in turn supported gold and pressured the U.S. dollar index.
Gold for April delivery tacked on $11.50, or 0.9%, to settle at $1,351.80 an ounce on the Comex division of the New York Mercantile Exchange, adding to Wednesday's modest climb. Thursday's settlement was the highest for a most-active contract since end October 2013.
May silver added 30 cents, or 1.4%, to $21.57 an ounce.
The ECB did not make any significant monetary policy moves on Thursday. The European Central bank left rates unchanged and the ECB's Mario Draghi said the central bank's accommodative monetary policy is finally finding its way through the economy. He continued to brush off the threat of deflation, which lowered the chance of further easing in the short term. That contributed to a boost in the euroNone were expected given some recent, generally upbeat economic data coming out of the European Union.
The situation in Ukraine has for now changed from a serious geopolitical matter to more of a regional issue of lesser significancefrom a market place perspective.
Traders looked for clues on the Federal Reserve's next move on monetary policy from the central bank's officials, ahead of Friday's U.S. monthly jobs report.
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At Wall Street, investors received four economic data points. Initial claims for the week ending 1 March 2013 fell by 26,000 to 323,000 (consensus 338,000). The Department of Labor said the decline coincided with strong winter storms, implying that layoffs were either deferred or individuals laid off were unable to file their unemployment claims.
Fourth quarter productivity was revised down to 1.8% (consensus 2.5%) from 3.2%. Unit labor costs declined 0.1% in the fourth quarter (consensus -0.7%) versus an originally reported 1.6% drop. The improvement was the end result of an increase in hourly compensation (positive) combined with a drop in output (negative).
Separate report showed that factory orders declined 0.7% in January after declining a downwardly revised 2.0% (from -1.6%) in December. The consensus expected factory orders to decline 0.5%.
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