Gold gains, stronger US jobs data caps rise

Gold gained on Thursday, snapping three straight sessions of declines as the dollar took a breather, but a slew of data from major economies limited the metal's advance.

Spot gold rose 0.2% to $1,792.76 per ounce by 9:50 am EDT (1350 GMT), after briefly hitting $1,800.69 earlier in the session.

US gold futures were up 0.2% to $1,797.00.

Making gold cheaper for holders of other currencies, the dollar edged down, while the euro extended modest gains after the European Central Bank said it would slow the pace of bond buying under its emergency scheme.

"The ECB is probably becoming much more optimistic on the economy and could probably start reducing stimulus at some point next year and that kind of sent gold back below $1,800," said Ed Moya, senior market analyst at foreign exchange brokerage OANDA.

The US weekly jobless claims also came in near 18-month lows, "which cements the belief that a December taper announcement was possible.... So gold prices are going to consolidate around these levels," he added.

US weekly jobless claims near 18-month low; labor market remains on track

Initial claims for state unemployment benefits dropped 35,000 to a seasonally adjusted 310,000 for the week ended Sept. 4, the lowest level since mid-March 2020.

Gold tends to gain when interest rates are low, while some investors also view bullion as a hedge against higher inflation that could follow stimulus measures.

Meanwhile, the Fed reported on Wednesday that the US economy "downshifted slightly" in August in the face of a renewed COVID-19 surge.

"Overall uncertainty is keeping gold supported, while the longer term element underpinning prices is the prevalence of negative real rates... unless and until inflation becomes an economic threat, the real interest rate argument is more persuasive in gold's favour than inflation on its own," StoneX analyst Rhona O'Connell said.

Elsewhere, silver rose 0.7% to $24.12 per ounce, platinum gained 0.5% to $984.41, while palladium fell 0.8% to $2,233.42.