2020.09.0311:07:00UTC+00Gold Prices Fall On Firmer Dollar

Gold prices fell on Thursday to hover near one-week low as the U.S. dollar continued to claw back ground against its major peers ahead of the weekly jobless claims, the U.S. trade deficit and service sector activity data later in the day and Friday's non-farm payrolls report.

Spot gold dropped 0.6 percent to $1,931.58 per ounce, after having fallen 1.4 percent on Wednesday in its biggest single-day fall since August 19. U.S. gold futures were down 0.4 percent at $1,936.30.

The euro remains on the back foot after surveys showed the euro zone's rebound from its deepest economic downturn on record faltered in August.

Germany's services PMI fell, but nevertheless remained relatively healthy. French business activity growth eased as new orders stagnated. The services PMIs for Italy and Spain dropped below the breakeven mark due to restrictions on logistics and travel.

Meanwhile, Eurozone retail sales fell unexpectedly in July on weak non-food products turnover, Eurostat data showed.

The Financial Times reported that the European Central Bank (ECB) is worried about the euro's rise, which threatens the bloc's economic recovery.

The report came after remarks from ECB chief economist Philip Lane on the exchange rate level that sparked a reversal of some of the euro's recent strength on Wednesday.

Lane said that the euro-dollar rate "does matter" for monetary policy, hinting that policymakers are uncomfortable with the currency's strength.

The ECB will meet next week, with investors expecting further action to boost the economy.