Gold prices ignore in-line preliminary Q2 U.S. GDP data
(Kitco News) - The gold market continues to hold steady seeing some technical profit taking as the U.S. economy expanded in line with expectations in the second quarter of 2019
Thursday, the second reading of U.S. Gross Domestic Product showed that the U.S. economy grew 2% between April and June, in line with economist expectations, but down slightly from 2.1% reported in the initial report.
Gold prices seeing little reaction to the economic data. The yellow metal is under some modest selling pressure as its momentum has slowed after hitting a fresh six-year high earlier in the week. December gold futures last traded at $1,548 an ounce, down 0.6% on the day.
Looking at the components of the report, the U.S. consumer remains a strong pillar of the community; Personal consumption increased in the second quarter to 4.7%, up compared to the initial estimate of 4.3%. Economists expected to see an unchanged reading.
“Never underestimate the power of the US consumer. The worry here though is if the consumer slowed down,” said Adam Button, managing director of Forexlive.com
However, business investment continues to remain weak dropping 0.6% in the second quarter, unchanged from the previous estimate. This is the first contraction in business investment since 2016.
Trade also weighed on growth exports declined more than expected, dropping 5.8%, down from the initial forecast of -5.2%. Meanwhile imports rose 0.1%, unchanged from the previous estimate.