On Wednesday, gold prices go up in quiet trading on the eve of the New Year as investors are now waiting for the publication of key US data to get further guidance on the strength of economy.
Trading volumes are expected to remain low due to Christmas holidays, while many traders close positions before the end of the year, reducing liquidity in the market and increasing volatility. US markets will remain closed on Friday for Christmas.
During European morning trading, on Comex division of the New York Mercantile Exchange, gold futures for February delivery rose $ 4.10, or 0.38%, to $ 1072.40 per troy ounce. A day earlier, gold fell $ 5.80, or 0.54%, decreasing the second consecutive session.
Today US should release its weekly report on applications for unemployment benefits amid expectations of reducing the number of applications by 1000 to 270 000.
During European morning trade, the USD index, which tracks the US currency against a basket of six major rivals, fell 0.4% to 97.99.
The decline of the dollar followed the disappointing economic statistics, published in the previous session. The US orders for capital goods (excluding defense and aviation), an indicator of investment in the private sector, showed a decline of 0.4% last month, less than expected decline of 0.1%.
However, separate reports showed that personal spending rose in November, the eighth consecutive month, while consumer sentiment improved in December to five-month high.
The focus of the market gradually shifted from the first rate hike in the US since 2006 to the pace of future growth of interest on loans. Fed, according to its forecasts, has planned four rate hikes for next year. Nevertheless, the federal funds futures now imply only 2 hikes in the coming year - in June and December.
In 2015, gold futures may show a decline of 10%, falling for the third year in a row, as speculation on terms of Fed rate hike is putting pressure on market sentiment for most part of the year. Increased interest on loans has a negative impact on the precious metal because it cannot compete with the profitable assets in a period of growing rate.
Meanwhile, silver futures for March delivery rose 1.8 cents, or 0.13%, to $ 14.30 per troy ounce. In 2015, the silver may show a decline of 8%.
Copper lost 0.3 cents, or 0.16%, to $ 2.121 per pound. In 2015, copper can demonstrate an annual decline of 26% as fears about the global economic slowdown led by China discouraged traders and undermined sentiment.
The Asian country is the world's largest consumer of copper, with its share of almost 45% of world consumption last year.