■ The precious metal finds strong buying interest as USD weakness persists across markets
■ Revised GDP figures show US economic growth slowing more than analysts anticipated
■ Market sentiment shifts dramatically with high probability of monetary policy easing
■ All attention turns to crucial inflation metrics that could shape Fed's 2024 roadmap
The gold market continues its upward trajectory during Friday's trading session, building on recent gains as the US Dollar shows persistent weakness. Spot gold (XAU/USD) currently hovers around $2,055, marking a significant 0.53% daily increase as market participants digest the latest economic developments.
Currency markets witnessed the US Dollar Index (DXY) touching its weakest level since summer, currently positioned near 101.80. This decline comes alongside modest movements in Treasury yields, with the benchmark 10-year note yielding approximately 3.89% as investors reassess their positions following the latest macroeconomic indicators.
Thursday's economic releases painted a concerning picture of US economic momentum. The Bureau of Economic Analysis reported third-quarter GDP growth at 4.9%, falling short of market expectations. Concurrently, weekly jobless claims data revealed unexpected resilience in the labor market, with initial claims registering 205,000 versus projections of 215,000 - creating mixed signals for policymakers.
These economic indicators collectively suggest that current Federal Reserve policy measures may be achieving their intended cooling effect on economic activity. Market participants now anticipate multiple rate reductions in 2024, with CME FedWatch data showing nearly 80% probability of easing as early as March. Such expectations naturally support non-yielding assets like gold, which tend to benefit from lower interest rate environments.
Market focus now shifts decisively toward Friday's Core PCE Price Index release, the Federal Reserve's preferred inflation metric. Economists project monthly and annual increases of 0.2% and 3.3% respectively. Additional economic reports including consumer confidence surveys, durable goods orders, and housing market data will provide further context for gold traders evaluating the metal's near-term trajectory.
