Investing.com - Gold futures climbed to three-month highs on Friday, on the back of a weaker U.S. dollar and as investors awaited the release of U.S. data later in the day amid fresh concerns over the strength of the country''s economic recovery.
On the Comex division of the New York Mercantile Exchange, gold futures for April delivery traded at USD1,317.20 a troy ounce during European afternoon trade, up 1.30%.
The April contract settled 0.39% higher on Thursday to end at USD1,300.1 a troy ounce.
Gold futures were likely to find support at USD1,286.30 a troy ounce, Thursday''s low and resistance at USD1,327.30.
Gold prices gained ground after the U.S. Commerce Department on Thursday said that retail sales fell by a seasonally adjusted 0.4% last month, disappointing expectations for a 0.3% increase. Retail sales for December were revised down to a 0.1% decline from a previously reported increase of 0.2%.
Rising retail sales over time correlate with stronger economic growth, while weaker sales signal a declining economy.
Core retail sales, which exclude automobile sales, were unchanged last month, compared to forecasts for a 0.1% increase. Core sales in December were revised down to a gain of 0.3% from a previously reported increase of 0.7%.
Core sales correspond most closely with the consumer spending component of the government''s gross domestic product report. Consumer spending accounts for as much as 70% of U.S. economic growth.
A separate report showed that the number of people who filed for unemployment assistance in the U.S. last week rose unexpectedly, underlining concerns over the strength of the labor market.
The disappointing data stirred speculation the Federal Reserve will take a gradual approach to tapering its bond-buying stimulus this year. The Fed tapered its monthly asset purchase program by another USD10 billion to USD65 billion a month at its last policy meeting.
Elsewhere on the Comex, silver for March delivery jumped 3.20% to trade at USD21.048 a troy ounce, while copper for March delivery edged up 0.04% to trade at USD3.251 a pound.