Gold Ends Higher On Demand Growth Prospects

(RTTNews) - Gold futures ended higher on Thursday, after the world's second biggest consumer of gold, India, lifted some of the restrictions on import of the precious metal. Gold also found additional support with reports of some fierce fighting in eastern Ukraine, notwithstanding some largely upbeat global economic data.

The Reserve Bank of India had imposed major restrictions on gold imports in order to check the current account deficit, with the rupee dropping. The Indian central bank's move now enables more players to import gold apart from the permitted banks, which is expected to help boost exports.

Gold for June delivery, the most actively traded contract, gained $6.90 or 0.5 percent to close at $1,295.00 an ounce on the Comex division of the New York Mercantile Exchange on Thursday.

Gold for June delivery scaled an intraday high of $1,304.10 and a low of $1,290.10 an ounce.

Holdings of SPDR Gold Trust, the world's largest gold-backed exchange-traded fund, declined to 776.89 tons on Thursday, from its previous close of 780.19 tons.

The dollar index, which tracks the U.S. unit against six major currencies, traded at 80.27 on Thursday, up from its previous close of 80.07 late Wednesday in North American trade. The dollar scaled a high of 80.28 intraday and a low of 80.07.

The euro traded lower against the dollar at $1.3647 on Thursday, as compared to its previous close of $1.3687 late Wednesday in North America. The euro scaled a high of $1.3690 intraday and a low of $1.3646.

In economic news from the U.S., the data from the Labor Department showed initial jobless claims to have climbed to a more than expected 326,000 in the week ended May 17. Economists expected claims to increase to 310,000 from 297,000 in the previous week.

The data released by the National Association of Realtors showed existing home sales in the U.S., rose 1.3 percent to a seasonally adjusted annual rate of 4.65 million in April, from 4.59 million in March. That was slightly lower than an expected climb to 4.69 million.

The Conference Board's index of leading U.S. economic indicators was up for the third consecutive month, rising by 0.4 percent in April following an upwardly revised 1.0 percent increase in March.

Meanwhile, according to the flash purchasing managers index released by Markit, U.S. manufacturing activity improved to a 3-month high in May, with the manufacturing PMI rising to 56.2 compared to the 55.4 in April. The consensus estimate called for an increase to 55.9.

The U.K. economy grew at a faster pace as initially estimated in the first quarter, with its gross domestic product up 0.8 percent from the prior quarter, and unchanged from the estimate published on April 29. The sequential growth follows a 0.7 percent rise in the fourth quarter of last year. On a yearly basis, GDP rose 3.1 percent in the first three months of 2014, in line with initial estimates.

China Manufacturing Purchasing Managers' Index improved to 49.7 in May from a final reading of 48.1 in April, according to a HSBC Flash reading. Economists estimated a reading of 48.4. Nonetheless, this is still below the 50-point with indicates a contraction.