Gold Weighed Down by Strong Dollar and Postive Jobs Report

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By Jacob Maslow

Gold futures fell slightly lower on Wednesday, as investors eyed key U.S. data later in the day to see if the world’s largest economy is robust enough to absorb additional rate increases this year.

Analysts are expecting the ADP nonfarm data to show a growth of 190,000 in jobs in February, following a 151,000 increase in the previous month. Unemployment rate is projected to remain at 4.9%.

Gold price for April delivery on the New York Mercantile Exchange fell $1.40, or 0.11%, to trade at $1,229.40 a troy ounce by 4:35AM ET.

On Tuesday, gold shed $3.60, or 0.29%, after positive U.S. manufacturing figures increased speculations of the Federal Reserve adopting more rate hikes this year.

The Institute for Supply Management said its index of purchasing managers went up to 49.5 in February from 48.2 in January, beating analyst projections by a full point.

The U.S. dollar index, which tracks the greenback’s standing against six major currencies, was up 0.15% at 98.49.  A stronger U.S. dollar usually drags gold prices down, as it makes the precious metal a less appealing asset.

In related metals trading, futures for silver slated for March delivery tacked on 6.2 cents, or 0.42%, to trade at $14.79 a troy ounce, futures for copper gained 2.3 cents, or 1.1%, to $2.169 a pound amid investor optimism on the improving state of the global economy.

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