Silver futures higher ahead of U.S. jobless claims report

Investing.com - Silver futures were higher on Thursday as investors looked ahead to a weekly report on U.S. initial jobless claims later in the trading day, a data point that will be scrutinized for its potential impact on the Federal Reserve's monetary policy stance.

Investors have closely been looking out for U.S. data reports recently to gauge if they will strengthen or weaken the case for the Fed to reduce its bond purchases.

Any improvement in the U.S. economy was likely to reinforce the view that the central bank will begin to taper its bond purchase program in the coming months.

Moves in the silver price this year have largely tracked shifting expectations as to whether the U.S. central bank would end its bond-buying program sooner-than-expected.

On the Comex division of the New York Mercantile Exchange, silver futures for September delivery traded at USD19.70 a troy ounce during European morning trade, up 1%.

Silver futures hit a session high of USD19.84 a troy ounce earlier in the day.

The September contract settled down 0.1% at USD19.50 a troy ounce on Wednesday, after falling to a session low of USD19.12 a troy ounce, the weakest level since July 10.

Silver prices were likely to find near-term support at USD19.12 a troy ounce, Wednesday’s low and resistance at USD19.98, the high of August 5.

The precious metal was higher due to a broadly weaker U.S. dollar, as dollar-priced commodities become cheaper to investors holding other currencies when the greenback weakens.

The dollar index, which tracks the performance of the greenback against a basket of six other major currencies, was down 0.15% to trade at 81.17, the lowest level since June 19.

Cleveland Fed President Sandra Pianalto said Wednesday there has been “meaningful improvement” in the labor market and that tapering may be warranted if it continues to strengthen.

Her comments echoed similar remarks made by Chicago Fed President Charles Evans and Dallas Fed President Richard Fisher earlier in the week.

Silver prices are on track to post a loss of almost 37% on the year, amid speculation the Fed will start to unwind its bond purchasing program in the coming months.

Elsewhere on the Comex, gold for December delivery rose 0.2% to trade at USD1,287.90 a troy ounce, while copper for September delivery rallied 2.4% to trade at USD3.250 a pound.

Market sentiment improved after official trade data released earlier showed that Chinese exports rose 5.1% from a year earlier in July, beating expectations for a 3% increase and following a 3.1% drop in June.

The data showed that imports surged 10.9%, blowing past forecasts for a 2.1% increase and following a 0.7% decline in June.

The country’s trade surplus narrowed to USD17.8 billion for the month from a surplus of USD27.1 billion in June.

The upbeat report eased concerns over a slowdown in the world’s second-largest economy and biggest consumer of the industrial metal.

Market players now looked ahead to a raft of Chinese economic data on Friday, including reports on inflation, industrial production and retail sales.