Gold ends higher after Putin's remarks, US job data

Source: World Gold Council

Gold prices settled modestly higher on Thursday, logging a third straight daily gain, as investors shrugged off a bigger-than-expected rise in U.S. jobless claims, while conciliatory comments from Russian President Vladimir Putin eased jitters about the Ukraine crisis that had prompted some safe-haven buying of bullion.

The number of Americans filing new claims for unemployment benefits rose more than expected last week. But analysts said the four-week average of claims remained consistent with solid job gains, analysts said.

Analysts said some recent U.S. economic indicators have fed investor skepticism about whether the U.S. economy is definitely out of the woods. Gold prices have been under pressure due to speculation that a stronger economy could encourage the Federal Reserve to raise interest rates soon.

Gold / US Dollar Spot

"These data releases give gold a boost now and again as they are seen as restraining the more hawkish Fed governors, though they haven't ever been enough to change medium-term expectations for the U.S. economy or gold," Turner said.

U.S. gold futures for December delivery ended $1.20 higher at $1,315.70 an ounce, while spot gold was last up 40 cents on the day to $1,313 an ounce.

On Wednesday, a disappointing retail sales report for July eased fears that the Fed might raise rates sooner than expected.

Bullion gains were also limited on signs of easing tensions after President Vladimir Putin said Russia would stand up for itself but not at the cost of confrontation with the outside world.

So far this year, gold has risen 9 percent, boosted by political conflict in Ukraine, Iraq and Israel. But in physical market news, the World Gold Council said global gold demand fell in the second quarter, as a plunge in jewelry, coin and bar sales from last year's record levels outweighed lower liquidation of gold-backed exchange-traded funds.

Reflecting investor sentiment, holdings in SPDR Gold Trust , the world's largest gold-backed ETF, fell 0.26 tonnes to 795.60 tonnes on Wednesday.

—By Reuters