2019.12.1218:23:00UTC+00Gold Futures Settle Lower On Renewed Optimism About Trade Deal

Gold prices edged lower on Thursday as equities gained in strength and the dollar stayed fairly steady amid optimism about a potential U.S.-China trade deal after positive comments from U.S. President Donald Trump.

Traders also digested the European Central Bank's monetary policy announcement and comments by new ECB chief Christine Lagarde.

The dollar index, which was down sharply at 97.04 early on in the session, rallied to 97.52 and was last seen hovering around 97.45, up marginally from previous close.

Gold futures for February ended down $2.70, or about 0.2%, at $1,472.30 an ounce.

On Wednesday, gold futures for February ended up $6.90, or 0.5%, at $1,475.00 an ounce.

Silver futures for March ended up $0.100 at $16.949 an ounce, while Copper futures for March settled at $2.7965 per pound, gaining $0.0070 for the session.

On the trade front, U.S. President Donald Trump expressed optimism about a potential U.S.-China trade deal.

"Getting VERY close to a BIG DEAL with China. They want it, and so do we!" Trump said in a post on Twitter Thursday morning.

Trump has repeatedly expressed optimism about a trade deal but has previously suggested China wants to reach an agreement more than the U.S.

On the economic front, First-time claims for U.S. unemployment benefits jumped by much more than expected in the week ended December 7th, according to a report released by the Labor Department.

The Labor Department said initial jobless claims surged up to 252,000, an increase of 49,000 from the previous week's unrevised level of 203,000. Economists had expected jobless claims to edge up to 213,000.

With the much bigger than expected increase, jobless claims reached their highest level since hitting 257,000 in September of 2017.

With higher prices for goods offsetting lower prices for services, the Labor Department released a report on Thursday showing U.S. producer prices came in unchanged in the month of November.

The Labor Department said its producer price index for final demand was flat in November after climbing by 0.4% in October. Economists had expected prices to rise by 0.2%.

Excluding increases in food and energy prices, core producer prices dipped by 0.2% in November after rising by 0.3% in October. Core prices had been expected to inch up by 0.2%.