Tuesday, May 24, 2022

Gold price unfazed by US Q4 GDP at 6.9%

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(Kitco News) – The US economy grew slightly less than expected in the last three months of 2021; however, the latest economic data is having little impact on gold prices as it holds above important support around $1,925.

Wednesday, the US Commerce Department said third and final estimate for fourth-quarter GDP showed that the US economy advanced by 6.69, down slightly from the previous estimate of 7%. The data slightly missed expectations as consensus forecasts were expecting to see an unchanged reading of 7%.

The gold market is unfazed by the latest slightly disappointing economic data. April gold futures last traded at $1,927.50 an ounce, up 0.80% on the day. According to some market analysts, gold is seeing technical buying momentum after prices briefly dropped below $1,900 an ounce Tuesday.

Analysts have said that gold’s uptrend remains intact if prices can hold above $1,925 an ounce. However, the precious metal also faces challenging resistance around $1,950 an ounce, analysts have also noted.

Most economists have dismissed the latest GDP data because it is extremely data. Most are now focused on economic growth for the first quarter of 2022.

“This report is ancient history now and not a market mover. While it’s a slight miss, it’s a reminder that growth was sizzling coming into the year,” said Adam Button, chief currency strategist at Forexlive.com.

Positive for the gold market, inflation is not going anywhere anytime soon. The report said that fourth-quarter GDP Price Index rose 7.1%, unchanged from the previous estimate.

Disclaimer: The views expressed in this article are those of the author and may not reflect those of Kitco Metals Inc. The author has made every effort to ensure accuracy of information provided; however, neither Kitco Metals Inc. nor the author can guarantee such accuracy. This article is strictly for informational purposes only. It is not a solicitation to make any exchange in commodities, securities or other financial instruments. Kitco Metals Inc. and the author of this article do not accept culpability for losses and/ or damages arising from the use of this publication.

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