1st LD Writethru: Gold up on weaker U.S. dollar

Gold futures on the COMEX division of the New York Mercantile Exchange rose Thursday as the U.S. dollar showed weakness.

The most active gold contract for June delivery rose 7 U.S. dollars, or 0.57 percent, to settle at 1,235.60 dollars per ounce.

Gold was given support as the U.S. Dollar Index fell by 0.24 percent to 94.60 as of 1750 GMT. The index is a measure of the dollar against a basket of major currencies. 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.

The precious metal was given further support as a report released by the U.S. Department of Labor showed initial jobless claims rising by 11,000 to 276,000 during the week of March 26. This figure was slightly worse-than-expected, however, analysts note that jobless claims remain near record lows which is a positive sign for the U.S. economy.

Gold was prevented from rising further as a report released by the Institute for Supply Management showed the Chicago business barometer index increasing by 6 points to 53.6. Analysts note that this was much better than expected and that there are both plenty of new orders and backlog orders, while inventories are decreasing.

The U.S. Dow Jones Industrial Average fell by 16 points, or 0.09 percent as of 1700 GMT, giving further support to the precious metal. Analysts note that when equities post losses, the precious metal usually goes up, as investors are looking for a safe haven, while the opposite is true when U.S. equities post gains.

Silver for May delivery rose 25.3 cents, or 1.66 percent, to close at 15.464 dollars per ounce. Platinum for July delivery added 11.3 dollars, or 1.17 percent, to close at 977.50 dollars per ounce. Endit