Gold fell on Thursday, its fourth consecutive daily drop, hit by strong US factory data and a dollar rally after the European Central Bank chief said euro-zone interest rates will remain low for an extended period of time. Some traders stayed on the sidelines ahead of Friday's important US nonfarm payrolls data, which could shed more light on the Federal Reserve's planned tapering of monetary stimulus. Economists expect payrolls to rise by 184,000 in July, pushing the jobless rate near its lowest level in more than four years.
Spot gold was down 0.8 percent at $1,311.50 an ounce by 3:13 pm EDT (1913 GMT). Bullion is now testing its 20-day moving average support at above $1,304, and will likely face overhead resistance at $1,326 near its 50-day average, analysts said. US gold futures for December delivery settled down $1.80 at $1,311.20, with trading volume about 25 percent below its 30-day average, preliminary Reuters data showed.
Gold's 22 percent drop year to date is hurting the profitability of gold miners. The world's No 1 gold producer Barrick Gold posted an $8.7 billion writedown and cut its dividend by 75 percent on falling gold price, while Kinross Gold reported a quarterly loss and suspended its semi-annual dividend altogether. Among other precious metals, silver was down 0.8 percent at $19.65 an ounce. Platinum gained 0.4 percent to $1,439.25 an ounce, while palladium climbed 0.6 percent to $730.22 an ounce.
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