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Gold Settles Down 1 Percent on Broad Dollar Rally

Source: World Gold Council

Gold fell 1 percent in choppy trade on Thursday as the dollar rose to a four-year high against the yen and rallied against the euro, decreasing bullion's appeal as a hedge against U.S. currency depreciation.

After trading slightly lower earlier in the session, bullion accelerated losses after the dollar smashed above the 100 yen mark and jumped 1 percent against the euro. The resurgent dollar also weighed down on equities and other industrial commodities such as crude and copper.

Bullion investor sentiment remains lackluster as outflows in gold-backed exchange-traded funds showing no signs of abating.

"There was heavy put activity, which is usually a bearish sign," said Frank McGhee, head precious metals trader at Integrated Brokerage Services LLC.

Spot gold was down 1 percent to $1,457 an ounce. Some investors took profits after bullion posted a 1.4 percent gain in the previous session, its biggest one-day rise in two weeks.

U.S. gold futures settled down $5.10 to $1,468.60 an ounce, with trading volume on track to finish in line with its 30-day average, preliminary Reuters data showed.

Gold was under pressure earlier in the session after data showed the number of Americans filing new claims for jobless aid fell last week to its lowest level in nearly 5-1/2 years, reducing the need for more economic stimulus from the Federal Reserve.

Holdings of SPDR Gold Trust, the world's largest gold-backed ETF, fell 0.60 percent to 1,051.47 tons on Wednesday from 1,057.79 tonnes on Tuesday, the lowest level since March 2009.

(Read More: Retail Gold Buying Soars After Sharp Sell-Off)

Gold prices have recovered more than half of their losses

after a sharp selloff sent the metal to a two-year low of $1,321.35 on April 16.

However, hopes of surging demand from China in coming months, after net gold inflows from Hong Kong hit a record in March, might further support bullion prices, which have been hurt by sagging investor confidence this year, analysts said.

Silver fell 0.7 percent to nearly $24 an ounce.

Reflecting continued retail investment buying of silver, the U.S. Mint will limit dealers' purchases of its "America the Beautiful" five-ounce silver bullion coins when they go on sale next week.

Platinum Group Metals Higher

Platinum group metals rose on buying ahead of major wage talks between South Africa's major mining unions and PGM producers.

A plan by the world's No. 1 platinum producer Anglo American Platinum (Amplats) to reveal its revised restructuring plan on Friday also boosted demand, analysts said.

Gold's outlook remains uncertain with outflows in gold-backed exchange-traded funds showing no signs of abating.

Palladium rose 2.1 percent to $706 per ounce, and platinum rose 0.2 percent to $1,502 an ounce.

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