25 Oct Friday

Getting started with Reuters Update

In research news, Goldman Sachs said it expects gold prices to fall to USD 1144 an ounce in 2014, driven by improving U.S. economic data, rising real rates and the commencement of tapering of U.S. monetary stimulus.

"With open interest in gold growing, it indicates new business is not just because of short covering, and that gold buyers may keep a steady course," said George Gero, vice president of RBC Capital Markets.

Heavy positioning in the Comex November USD 1400 call options could provide upward pressure for bullion prices.

"The USD 1400  (call options) have the largest open interest by far, with almost 1.9 million ounces. This could prove a magnet for spot should we continue to rally," TD Securities precious metals trading desk said in a note.

Gold was also underpinned by weaker U.S. dollar and by U.S. Treasury bond yields hovering near a three-month low after the weekly jobless claims data.

Positive manufacturing data from China, the world's second- largest gold consumer, also helped support gold prices on Thursday, traders said.