Gold settles higher, dollar backs off year highs

Gold futures tilted higher in American trade away from December 19 lows, while the dollar index fell off July 14, 2017 highs, following earlier mixed data from the US. 

As of 04:39 GMT, gold futures due on August 15 rose 0.09% to $1,271.70 an ounce from the opening of $1,270.50, while the dollar index shed 0.17% to 94.70 from the opening of 94.86, marking June 14 lows. 

Earlier US data showed the preliminary reading for the services PMI down to 56.5 in June from 56.8 in May, beating forecasts of 54.9, while the manufacturing PMI slipped to 54.6 from 56.4, missing forecasts of 56.3. 

World Gold Council 

Recently, the World Gold Council reported a 7% drop in global demand in the first quarter of 2018 to 973.5 tonnes, the lowest since the first quarter of 2008, as investments fell 27% on the precious metal to 287 tonnes from 383 tonnes in the first quarter of 2017. 

Central banks' gold demand rose 42% to 116.5 tonnes, especially from Russia, while jewelry demand steadied at 487.7 tonnes, as mine supplies grew 1% y/y to 770 thousand tonnes. 

Gold holdings at SPDR Gold Trust, the world's largest gold-backed investment fund, fell 4.13 tonnes on Thursday to a total of 824.63 tonnes, the lowest since February 16, after rising 3%, or 23.63 tonnes in 2017, while gold prices rose 13% last year.