Gold traded at the highest in a month mid-afternoon on Thursday, climbing for a third day as the dollar and yields moved lower after U.S. retail sales rose less than expected last month.

Gold for February delivery was last seen up US$34.50 to US$2,752.30 per ounce, the highest since Dec.11.

The U.S. Commerce Department on Thursday reported retail sales rose by 0.4% in December, down from a revised 0.8% in November and under expectations for a 0.5% monthly rise according to Marketwatch. The data follows on a slight drop in the core Consumer Price Index, excluding food and energy, reported on Wednesday that spurred hopes the Federal Reserve will speed interest-rate cuts, lowering the dollar and yields.

"Gold's data dependency is clearly present in pricing, especially with this week's inflation data and the related shift in swap traders back to pricing in a rate cut by July. While our price view is unchanged, this is indicative of the bouts of strength (and weakness) that we expect in gold. This, on balance, should lead to gold holding and its resiliency enduring," Christopher Louney, a commodities strategist at RBC Capital Markets, noted.

The dollar weakened, with the ICE dollar index last seen down 0.9 points to 109.0.

Treasury yields also weakened, with the U.S. two-year note last seen paying 4.245%. down 2.1 basis points, while the yield on the 10-year note was down 4.8 points to 4.609%.

Source : MT Newswires