Gold rose on Thursday as bullish Chinese manufacturing data boosted the nation's inflation-hedge appeal, but bullion's gains looked vulnerable as a better global economy and the Federal Reserve's planned scaling back of its stimulus program should weigh down prices.
Renewed labor unrest in South Africa, the world's top platinum producer and a major supplier of palladium, sent platinum group metals prices sharply higher. Bullion trade was choppy in below-average volume after data showed that U.S. jobless claims last week held near a six-year low and U.S. manufacturing activity rose this month, suggesting the economy is starting to find firmer footing.
China's Purchasing Managers' Index (PMI), a closely watched survey of the country's manufacturers, showed that efforts by the world's second-largest economy to halt a slide in economic growth might be paying off.
On Wednesday, gold ended lower after seesawing, as the latest Fed minutes provided few clues about the timing of the U.S. central bank's tapering.
A sharp rise in U.S. Treasury yields, seen as a gauge of interest rates, weighed down on precious metals and equities across the board.
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