Gold price down 1% on strong US economic data

me-metals: Gold prices declined by 1% on Wednesday as solid US economic data reinforced expectations of the Federal Reserve holding interest rates steady for now, dimming the appeal of the safe-haven metal.

According to me-metals cited from mining.com, By midday ET, spot gold traded at $3,292.75 per ounce, falling below the $3,300-an-ounce level for the first time in a month.

US gold futures also fell 1%, but maintained a higher price of $3,345.3 per ounce.

The decline followed better-than-expected US employment data for the month of July, as well as second-quarter GDP data that beat analyst expectations.

“The releases that just came out really look quite supportive for the economy. GDP was an upside surprise. Same with labor market addition. So both indicate that the Fed can continue to wait on cutting rates,” Nitesh Shah, commodities strategist at WisdomTree said in a note.

The Federal Reserve is widely expected to leave rates unchanged later in the day, resisting pressure from US President Donald Trump’s repeated calls for cuts. Traders currently see a 60% chance of the Fed cutting rates in September versus 66% before the data.

Shah also noted that the louder the administration voices its distaste for current policymaking, the more likely it is to drive gold prices, as the metal tends to thrive in low-rate environments.

Bullion has already risen by a quarter this year amid uncertainty surrounding global trade and increased buying pressure. In late April, it touched a record high of just above $3,500 an ounce.

source: mining.com