1st LD Writethru: Gold down on Greece debt hope, U.S. dollar strength

Gold futures on the COMEX division of the New York Mercantile Exchange fell on Thursday as the U.S. dollar strengthened and hopes rose for Greece to reach a deal to resolve a long-running debt showdown with its international creditors.

The most active gold contract for August delivery fell 9.7 U.S. dollars, or 0.82 percent, to settle at 1,175.20 dollars per ounce.

Analysts said that gold was put under pressure as Greece told the International Monetary Fund (IMF) on Thursday that it planned on bundling four payments due in June, with the first due Friday, into one single payment for June 30. This gave investors some confidence, as they had expected a deal, temporarily removing the need for gold as a safe haven, the analysts said.

The stronger U.S. dollar also weighed on gold as the U.S. Dollar Index, a measure of the dollar against a basket of major currencies, rose by 0.14 percent to 95.51 as of 1805 GMT. Gold and the dollar typically move in opposite directions, which means if the dollar goes up, gold futures will fall as gold, measured by the dollar, becomes more expensive for investors.

Moreover, a weekly jobless claims report released by the U.S. Department of Labor on Thursday put additional pressure on the precious metal as jobless claims fell by 8,000 during the May 30 week to a reading of 276,000.

The positive jobless claims report also increased speculation about the potential rise of interest rates. Due to worse-than- expected jobs data in March, analysts now believe that interest rates will rise in the fall. The next Federal Reserve policy meeting is scheduled for June 15, when investors expect signals on the timing of a rate increase.

Silver for July delivery dropped 37.7 cents, or 2.29 percent, to close at 16.103 dollars per ounce. Platinum for July delivery fell 4.9 dollars, or 0.44 percent, to close at 1,099.20 dollars per ounce. Endite