Gold up on soft US data

Gold futures on the COMEX division of the New York Mercantile Exchange rose on Wednesday as weak US economic data gave support to the precious metal.

The most active gold contract for December delivery rose $14.4, or 1.24 percent, to settle at $1,179.80 per ounce, reported Xinhua.

Gold was given support as a report released by the US Department of Commerce showed retail sales gaining by only 0.1 percent in September. Analysts noted that gasoline sales are leading the weakness, as they fell 3.2 percent during September.

However, analysts also noted that there are some indicators that consumer strength is growing as motor vehicles sales gained 1.7 percent in September.

The precious metal was also given a boost by the US Department of Labor's Producer Price Index report which showed a fall of 0.5 percent in September.

Despite the fact that energy prices are leading the weakness, services also weakened, falling by 0.4 percent in September after two months of 0.4 percent gains.

Analysts believed that the data may lead traders to speculate that deflationary pressures are increasing instead of decreasing.

Traders will also keep a close eye on the Consumer Price Index report from the US Department of Labor due out on Thursday for an indication on the state of inflation in the US.

The US Federal Reserve is also carefully monitoring the latest US economic data ahead of its two final meetings of 2015.