Gold prices are modestly lower this morning, as the US dollar retains yesterday’s gains and the final estimate for fourth quarter 2016 GDP meets expectations. Silver prices have benefited from a sudden bout of buying to swing from losses to marginal gains.
While off their highs for the week, gold prices are set to end the week with a gain. Gold is set to end the month of March near where it began, wiping out $50 of losses from the middle of the month that saw prices fall below $1,200 an ounce.
The final estimate of GDP in the fourth quarter of 2016 was slightly higher than the previous estimate, but still much lower than the third quarter. A newly-discovered spike in consumer spending lifted estimated GDP from 1.9% to 2.1%, generally matching expectations. The flipside of that increased consumer spending was that it came from demand for imported goods, widening the US trade deficit. For all of 2016, the economy grew at a pace of 1.6% – the worst showing in five years.
First-time jobless claims remain far below historical norms. There were 3,000 fewer people fired last week, compared to the week before, with 258,000 new applications for unemployment benefits.
In currency news, the dollar is holding on to the 100 mark on the DXY index of a basket of currencies, as the greenback attempts to rally from multi-month lows. The British pound is higher this morning, a day after the UK government officially filed papers to leave the European Union. The GBP had fallen to a one-week low in the immediate aftermath of the news.
Stocks remain range-bound today, with financial stocks helping the broader market cling to positive territory. Markets have lost direction since the failure of the Trumpcare bill in Congress, which was intended to replace some provisions of Obamacare.
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