2017.09.2113:58:00UTC+00Gold Plunges As Rate Hike Seems Certain

Gold futures tumbled Thursday as upbeat jobs data reinforced expectations the Federal Reserve will raise interest rates before year's end.

Dec. gold dropped $21.60, or 1.6%, to settle at $1,294.80/oz, the lowest since August. It was the worst single-session decline since July.

The Labor Department recently released a report showing an unexpected decrease in initial jobless claims in the week ended September 16th.

The report said initial jobless claims fell to 259,000, a decrease of 23,000 from the previous week's revised level of 282,000.

The continued decrease surprised economists, who had expected jobless claims to climb to 300,000 from the 284,000 originally reported for the previous week.

A separate report released by the Philadelphia Federal Reserve showed an unexpected improvement in regional manufacturing conditions in the month of September.

Yesterday, the Fed kept its key interest rate unchanged but maintained their so-called 'dot plot' of rate projections for this year and next, strongly hinting at a December rate hike.

Also, the Fed said it will begin shrinking its bloated $4.5 trillion portfolio in October by allowing $10 billion in bonds to mature without replacing them.