GOLD prices ticked up on Thursday (Feb 8) buoyed by a softer US dollar and lower Treasury yields, ahead of a weekly jobless claims report that could provide fresh clues on when the US Federal Reserve would start lowering interest rates.

Spot gold rose 0.2 per cent to US$2,037.80 per ounce, as at 0218 GMT.

US gold futures rose 0.1 per cent to US$2,053.10 per ounce.

The US dollar index fell 0.1 per cent, and yields on benchmark 10-year Treasury notes slipped to 4.0921 per cent, making non-yielding bullion more appealing for other currency holders.

Investors will be watching out for US weekly jobless claims data due at 1330 GMT after last week’s monthly non-farm payrolls report came in stronger-than-expected, showing signs of persistent strength in the labour market.

The US regional banking sector remained a concern as Moody’s downgraded New York Community Bancorp to junk citing pressure on its funding and liquidity.

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The KBW regional banking index pared losses but still ended lower and is down more than 5 per cent so far this month.

Fed officials want to hold off on cutting interest rates until they have more confidence that inflation is headed down to 2 per cent, and gave a range of reasons for feeling little urgency to start easing policy soon or to move quickly once they do.

Lower rates decrease the opportunity cost of holding bullion.

China’s consumer prices extended their decline for a fourth month in January while producer prices also dropped, underscoring deflationary risks facing the world’s second-biggest economy as it struggles to mount a solid recovery.

Spot silver rose 0.2 per cent to US$22.23 per ounce, platinum was flat at US$879.59, while palladium hit a five-year low, losing 0.2 per cent to US$893.31. REUTERS