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Market News Gold market analysis: weak GDP in the third quarter of the United States, gold remains high and fluctuates

Gold market analysis: weak GDP in the third quarter of the United States, gold remains high and fluctuates

On Thursday (October 28), GDP data showed that the significant slowdown in economic growth in the third quarter of the United States supported the price of gold, and the price of gold closed up, breaking the $1,800 mark again. New York Gold rose 0.2% to close at $1802.60.

2021-10-29
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On Thursday (October 28), GDP data showed that the significant slowdown in economic growth in the third quarter of the United States supported the price of gold, and the price of gold closed up, breaking the $1,800 mark again. New York Gold rose 0.2% to close at $1802.60.



The US Department of Commerce reported on Thursday that the US GDP growth rate in the third quarter fell to 2% from 6.7% in the second quarter. As the third-quarter gross domestic product data of the United States fell short of expectations, it eased the market’s concerns that the Federal Reserve raised interest rates faster than expected, and pushed up the price of gold. The lower than expected GDP in the third quarter of the United States will help to prove that Fed Chairman Powell's view that "the economy is not in danger of overheating and interest rates will remain very loose for the foreseeable future"-is correct. Metal traders also considered a decision of the European Central Bank on Thursday. As expected, the European Central Bank maintained its monetary policy unchanged, saying that it will continue to purchase assets through the emergency purchase plan, at a slower rate than in the second and third quarters. European Union interest rates will remain low, as the European Central Bank research shows that inflation will ease next year. For precious metals, this is a very good environment-inflation expectations are rising and interest rates are lower. In view of this, we may see precious metal prices start to rise as investors seek to increase the diversification of their investment portfolios. From a more macro perspective, gold investors are realizing that even if inflation remains high, the major central banks in general may not tighten monetary policy too aggressively. The reason is that there is still a large amount of idle production capacity in the economy, and the impact of short-term factors will subside in the next few months, causing inflation to cool down, and the need for the central bank to substantially tighten monetary policy will also decrease. Although on Wednesday, as the Bank of Canada said it would end its quantitative easing program and focus on eventually raising interest rates, the price of gold fell briefly. However, the yields fell, and the yields of the US 10-year Treasury bonds and 30-year Treasury bonds both recorded their biggest declines in three months. The inversion of the bonds also helped support gold buying.

Gold rebounded and closed high, the lowest backtest of 1783 started to stabilize, and it did not break low. The shock rebounded and closed near 1795. The daily closed on Xiaoyang Xianxian. The daily line accompanies the yin and yang cycle shocks is the most recent main style, the short-term unilateral trend is insufficient to continue, and the back and forth seesaw is the rhythm. Investors' attention seems to turn to the Federal Open Market Committee (FOMC) meeting next week. The expectation of the Federal Reserve's announcement to reduce the size of bond purchases may limit the rise in gold prices. Before the Federal Open Market Committee meeting, the price of gold may be traded in the range of $1780 to $1820.00. However, a breakthrough of $1835.00 will be a strong bullish technical signal.

Only personal views, not representative of the views of the organization

Source: Bank of China's official website, Bank of China Guangdong Branch Wang Gang, original title: "20211029-US GDP is weak in the third quarter, gold remains high and fluctuates"
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