Gold futures fall after upbeat U.S. data

SAN FRANCISCO (MarketWatch) � Gold futures fell Thursday as upbeat data on the U.S. economy helped to dull safe-haven demand for the precious metal.

Investors also looked forward to data at the end of the week on the health of the Chinese economy.

Gold for delivery in February GCG3 �declined $10.50, or 0.7%, to $1,672.70 an ounce on the Comex division of the New York Mercantile Exchange.

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Gold lost more ground after the U.S. Labor Department reported that the number of applicants for new jobless benefits fell last week to the lowest level since January 2008. Economists polled by MarketWatch had forecast a drop to 368,000. See: Initial jobless claims fall 37,000 to 335,000.

Separately, data from the Department of Commerce showed that construction on new U.S. homes jumped in December to the highest rate in more than four years. See: Housing starts jump in December.

�Good news on the U.S. economy will always be bad news for gold and silver bulls, as expectation of early withdrawal of [the third round of] quantitative easing...by the Federal Reserve increases,� said Chintan Karnani, chief analyst at New Delhi-based Insignia Consultants.

Getty Images Enlarge Image Gold falls after Thursday data.

Gold will need to close over $1,663 today and tomorrow to be in a �somewhat bullish zone,� he said. Silver will also need to trade over $30.66 until Monday to be in a bullish zone, he added.

March silver SIH3 �was last down 24 cents, or 0.8%, to $31.31 an ounce.

Gold prices on Wednesday had eased by 70 cents to settle at $1,683.20 an ounce, falling back after reaching its highest level since Jan. 2 earlier in the week. Read: Gold slips, but demand prospects look good.

�All the fundamental data that gold bugs love to talk about is already priced into the market,� said Jason Rotman, president of Lido Isle Advisors in Newport Beach, Calif.

�With global equities markets picking up steam, and with the [Federal Open Market Committee] indicating a possible end to QE3 this year, we believe this might be a very quiet year for gold, and it might even retrace some of the rally which occurred over the past decade,� he said.

A variety of factors have influenced metal markets this week, including Germany�s Bundesbank announcing it will repatriate some of its gold reserves.

Edward Meir, metals analyst at INTL FCStone, said that markets will likely drift for the balance of the week �at least until some of the Chinese macro numbers slated for release this weekend provide the markets with more direction.�

According to RBC analysts, the market consensus for Chinese fourth-quarter economic growth is 7.8%.

Around the wider metals complex, April platinum PLJ3 �added $2.70, or 0.2%, to $1,696.80 an ounce, but prices for the metal remained above that of gold�s.

Platinum prices settled with a premium over gold for the first time earlier in the week. This is only the second period of time since Sept. 2011 that platinum has cost more than gold.

Platinum prices jumped nearly $32 on Tuesday on news Anglo American Platinum Ltd. ZA:AMS �would suspend operations at some of its mines.

March palladium PAH3 �tacked on $1.05, or 0.1%, to $727.50 an ounce, while March copper HGH3 �traded at $3.66 per pound, up 5 cents, or 1.3%.