Gold prices were largely unchanged on Thursday as rising US Treasury yields offset support from a weaker dollar, while the market awaited Friday's US inflation data for clues on the Federal Reserve's policy outlook ahead of its December meeting.

Spot gold fell 0.2% to $4,195.69 an ounce, as of 15:05 GMT. US gold futures for February delivery fell 0.2% to $4,224.10 an ounce. "Higher yields are capping some upside (for gold), and the dollar index is generally providing some support," said Marex analyst Edward Meir.

The benchmark 10-year US Treasury yield rose 0.8%, while the US dollar index (.DXY) hit a one-month low, making gold more affordable for overseas buyers. Data on Thursday showed that new US jobless claims fell to 191,000 last week, the lowest level in more than three years and well below economists' expectations of 220,000.

Meanwhile, Wednesday's ADP report showed that US private sector employment fell by 32,000 in November, marking the sharpest decline in more than two and a half years.

A majority of more than 100 economists surveyed by Reuters expect the Federal Reserve to cut its benchmark interest rate by 25 basis points at its December 9-10 policy meeting, as the central bank seeks to support a weakening labor market.

Lower interest rates typically benefit non-yielding assets like gold.

Investors are now eyeing the September Personal Consumption Expenditures (PCE) report, the Federal Reserve's preferred inflation measure, due out on Friday. "The market won't move much between now and next week, and for gold, we're likely to be stuck in a relatively quiet trading range for a while," Meir said, adding that gold is unlikely to retest its previous high of nearly $4,400 this year.

Meanwhile, silver fell 3.3% to $56.54 after hitting a record high of $58.98 on Wednesday. The metal is up 96% this year, supported by a structural supply deficit, concerns about market liquidity, and its inclusion on the U.S. list of essential minerals.

Platinum fell 2.2% to $1,634.15, while palladium fell 2.1% to $1,430.38. (alg)

Source: Reuters.com