WASHINGTON (dpa-AFX) - Gold prices dropped on Thursday, losing ground after two straight days of gains. The dollar's recovery from recent losses hurt the yellow metal.
However, rising optimism about an interest rate cut by the Federal Reserve in September helped limit the downside in gold prices.
A closely watched Labor Department showed consumer prices rose by less than expected in April, reinforcing expectations the Federal Reserve will lower interest rates in the coming months.
According to CME Group's FedWatch tool, the chances rates will be a quarter point lower by September have reached 87.5%.
The dollar index climbed to 104.63 before paring some gains. The index was last seen at 104.48, up 0.12% from the previous close.
Gold futures for May ended down by $8.70 or about 0.36% at $2,380.00 an ounce.
Silver futures for May ended up by $0.151 or about 0.5% at $29.665 an ounce. Copper futures were at $4.8850 per pound, down $0.0395.
Data from the Labor Department today showed initial jobless claims slid to 222,000 in the week ended May 11th, a decrease of 10,000 from the previous week's revised level of 232,000. Economists had expected jobless claims to fall to 220,000 from the 231,000 originally reported for the previous week.
A separate report from the Labor Department said import prices shot up by 0.9% in April after climbing by an upwardly revised 0.6% in March. Economists had expected import prices to rise by 0.3% compared to the 0.4% increase originally reported for the previous month.
The annual rate of growth by import prices also accelerated to 1.1% in April from 0.4% in March, reflecting the largest over-the-year increase since December 2022.
A separate report released by the Fed showed U.S. industrial production came in flat in the month of April, with a surge in utilities output offset by decreases in mining and manufacturing output.
The Fed said industrial production came in unchanged in April after inching up by a downwardly revised 0.1% in March.
Economists had expected industrial production to edge up by 0.1% compared to the 0.4% increase originally reported for the previous month.
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