By Eric Onstad
LONDON (Reuters) - Gold edged lower on Thursday, pressured by a firmer dollar on the back of upbeat U.S. unemployment data and as some investors sold to redeem profits after bullion's recent advance.
Spot gold fell 0.2 percent to $1,252.34 per ounce by 1140 GMT, retreating from an overnight peak of $1,258.96.
U.S. gold futures were up 0.5 percent at $1,254.40, after climbing as much as 1 percent to $1,260.80 earlier in the day.
"The slight uptick in the dollar and some profit taking after the move late yesterday is probably bringing in that bit of weakness," said Jonathan Butler, commodities analyst at Mitsubishi in London.
The dollar index extended gains after data showed new applications last week for U.S. unemployment benefits recorded their biggest drop in nearly two years. [DLR/]
Those claims, however, will have no bearing on March U.S. non-farm payrolls data on Friday, which analysts say could be key for short-term direction of the gold market.
According to a Reuters survey of economists, non-farm payrolls likely increased by 180,000 jobs last month after rising 235,000 in February.
Investors were also cautious ahead of the meeting between U.S. President Donald Trump and Chinese President Xi Jinping due later on Thursday, the first between the world's two most powerful leaders.
Topping the agenda at Trump's Mar-a-Lago resort in Florida will be whether he makes good on his threat to use U.S.-China trade ties to pressure Beijing to do more to rein in its nuclear-armed neighbour North Korea.
Spot gold hit $1,261.15 on Tuesday, its highest since Feb. 27, but has failed to breach a key 200-day moving average of $1,258.
"It just hasn't shown any ability to break the 200-day moving average and clearly shows that the price action is not being driven in isolation but has been driven by the U.S. dollar," said Jeffrey Halley, senior market analyst at OANDA.
"It is kind of looking like gold is running out of steam in the short term."
Spot silver dropped 0.3 percent to $18.21 an ounce.
Platinum fell 0.8 percent to $951.50, while palladium gave up 0.5 percent to $801.33. It hit a more than two-year high of $815.70 in the prior session, surging nearly a fifth this year.
"Palladium has had quite a remarkable run and overall we're still positive since it has the strongest fundamentals of any of the precious metals. We're going to see another fairly sizeable deficit this year," Mitsubishi's Butler said.
(Additional reporting By Nallur Sethuraman in Bengaluru; editing by Susan Thomas and David Evans)
Disclaimer: No Business Standard Journalist was involved in creation of this content
