Gold down more than 1 percent as Fed hints at June rate hike

Gold futures on the COMEX division of the New York Mercantile Exchange fell on Thursday, a day after hawkish comments from the Federal Reserve suggested interest rates could be hiked as early as June.

The most active gold contract for June delivery fell 19.60 U.S. dollars, or 1.54 percent, to settle at 1,254.80 dollars per ounce.

Gold was put under extensive pressure as minutes of the Fed's April meeting, released on Wednesday, showed that most regulators thought a June rate hike was appropriate, given continued improvement in the U.S. economy.

According to the CMEGroup's Fedwatch tool, the current implied probability of a hike is at 28 percent for the June meeting till Thursday noon, 50 percent at the July 2016 meeting, and 62 percent at the September 2016 meeting.

The U.S. Dollar Index also rose on the hawkish minutes, putting more pressure on the precious metal.

On the economic front, initial jobless claims were down a sharp 16,000 in the May 14 week to 278,000, however, the four-week average is up sharply, 7,500 higher to 275,750, the U.S. Labor Department said on Thursday.

Moreover, the Philadelphia Federal Reserve showed its General Business Conditions Index fell to a negative 1.8 level. Analysts noted that this was worse than expected and lent support to the precious metal.

Silver for July delivery fell 63.90 cents, or 3.73 percent, to close at 16.493 dollars per ounce. Platinum for July delivery shed 29.20 dollars, or 2.80 percent, to close at 1,013.30 dollars per ounce. Endit