Moderate losses for bullions

Strong dollar rebound impacts prices

Bullion metals closed lower on Thursday, 08 May 2014 as a drop in weekly U.S. jobless claims helped provide a boost to the stock market. Traders also assessed Congressional testimony given by Federal Reserve Chairwoman Janet Yellen on Wednesday and Thursday. Her generally upbeat comments on the economy contributed to precious metal's loss. The U.S. dollar index on Thursday hit a multi-month low but then made a strong rebound to trade higher on the day which pushed down bullion prices.

Gold for June delivery fell $1.20, or 0.1%, to settle at $1,287.70 an ounce on the Comex division of the New York Mercantile Exchange. Including Thursday's action, prices have lost a total of 1.7%, or $21.60 an ounce, in three sessions.

July silver also lost 20 cents, or 1.1%, to $19.14 an ounce after a 1.5% decline in the previous session.

The U.S. dollar index on Thursday hit a multi-month low but then made a strong rebound to trade higher on the day. When the greenback bounced the gold market saw some increased selling pressure surface.

The European Central Bank at its monthly monetary policy meeting made no change in ECB monetary policy, as expected. ECB President Mario Draghi said it his press conference following the ECB meeting that the bank could move to lower interest rates or inject more monetary policy stimulus at its meeting in June.

Fed Chair Janet Yellen spoke to the U.S. Congress again today, this time to a Senate committee. Her remarks were about the same as those she made on Tuesday to the Joint Economic Committee of Congress. The take away from this week's Yellen comments is that the U.S. economy is on the upswing.

Regarding economic data expected at Wall Street today, the initial claims level fell to 319,000 for the week ending 3 May from an upwardly revised 345,000 (from 344,000) for the week ending April 26. The consensus expected the initial claims level to fall to 325,000. The continuing claims level fell to 2.685 mln for the week ending 26 April from a downwardly revised 2.761 mln (from 2.771 mln) for the week ending April 19, while the consensus expected a decline to 2.750 mln.

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