Investing.com - Gold prices turned higher on Thursday, erasing earlier losses as the U.S. dollar weakened despite the release of upbeat U.S. economic reports.
Comex gold futures were up $5.80 or about 0.47% at $1,288.79 a troy ounce by 08:40 a.m. ET (12:40 GMT).
The greenback was lower even after the U.S. Department of Labor reported on Thursday that initial jobless claims fell more than expected last week.
A separate report showed that manufacturing activity in the Philadelphia region unexpectedly rose in October.
The U.S. dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, was down 0.31% at 93.01, off Wednesday's one-and-a-half week high of 93.65.
Gold is sensitive to moves in the dollar. A weaker dollar makes gold less expensive for holders of foreign currency.
The precious metal weakened earlier in the week amid ongoing speculation over the next head of the Federal Reserve.
U.S. President Donald Trump was set to meet with current Chair Janet Yellen later in the day as part of his search for a new candidate for her position.
She is one of five candidates Trump is considering for the job. Stanford University economist John Taylor, regarded by market watchers as more hawkish than Yellen, is currently seen as a front-runner, according to media reports.
Taylor is known as a proponent of a rule-based monetary policy and according to his formula, known as the Taylor rule, the Fed funds rate needs to be much higher than where it currently stands.
Market players are also keeping an eye on current Fed Governor Jerome Powell and former Fed official Kevin Warsh as potential candidates to succeed Yellen when her term ends in February.
President Donald Trump will announce his decision on next Fed chair in the "coming days," White House spokeswoman Sarah Sanders said on Wednesday.
Elsewhere on the Comex, silver futures dropped 0.34% to $17.06 a troy ounce.
Meanwhile, copper futures slid 0.44% to $3.164 a pound following a string of economic reports out of China.
Third-quarter GDP showed the Chinese economy grew 6.8% compared to a year ago, meeting analyst expectations. That was a touch softer than the 6.9% growth seen in the second quarter of the year.
Other data releases were mixed. China's industrial production increased 6.6% in September compared to one year ago, beating forecasts for 6.2%. September retail sales also topped expectations, increasing by 10.3% compared to the previous year, above the 10.2% forecast. Fixed asset investment for the month, however, came up short.