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CHICAGO, Dec. 8 (Xinhua) -- Gold futures on the COMEX division of the New York Mercantile Exchange fell on Thursday as the European Central Bank' s decision on quantitative easing supported the U.S. dollar.
The most active gold contract for February delivery fell 5.1 U.S. dollars, or 0.43 percent, to settle at 1,172.40 dollars per ounce.
The U.S. dollar was given support as Mario Draghi, president of the European Central Bank (ECB) announced that the ECB would reduce the pace of its bond-buying program, also known as quantitative easing, beginning in April 2017.
Investors saw this announcement as a weakness for the Euro, and a positive for the U.S. dollar, as the U.S. Dollar Index rose by 0.98 percent to 101.20 as of 1800 GMT. The index is a measure of the dollar against a basket of major currencies. Gold and the dollar typically move in opposite directions, which means if the dollar goes up, gold futures will fall as gold, measured by the dollar, becomes more expensive for investors.
Gold was put under further pressure as a report released by the U.S. Department of Labor showed initial jobless claims falling by 10,000 to a 258,000 level during the week of December 3rd. Analysts note that although this figure was within expectations, this report is in line with others which show consistently low jobless claims: a positive sign for the U.S. economy.
Investors are also monitoring the likelihood of a U.S. central bank rate hike during the December Federal Open Market Committee (FOMC) meeting beginning next week on Tuesday and ending on Wednesday with a press conference and announcement.
According to the CME Group' s Fedwatch tool, the current implied probability of a hike from 0.50 to at least 0.75 is at 97 percent at the December meeting and 97 percent for the February meeting.
The precious metal was put under additional pressure as the U.S. Dow Jones Industrial Average rose by 78 points, or 0.4 percent as of 1815 GMT. Analysts note that when equities post losses, the precious metal usually goes up, as investors are looking for a safe haven, while the opposite is true when U.S. equities post gains.
Silver for March delivery fell 17.9 cents, or 1.04 percent, to close at 17.096 dollars per ounce. Platinum for January delivery rose 0.6 dollars, or 0.06 percent, to close at 943.80 dollars per ounce.
