Gold News: XAUUSD Dips Under 50-Day MA on Strong Durable Goods and Sticky Inflation

Gold Slips as Traders Digest Mixed U.S. Data and Fed Signals

Gold prices turned lower Thursday as traders digested conflicting economic signals from the U.S., with XAU/USD struggling to hold support near its 50-day moving average of $3325.10. After rallying early in the week, the metal reversed course, shedding gains on the back of stronger-than-expected durable goods data and firm inflation readings, despite weakness in GDP and rising jobless trends.

At 13:15 GMT, XAU/USD is trading $3319.13, down $13.26 or -0.40%.

U.S. GDP Contracts but Inflation Holds Firmhomejames

The XAU/USD by 0.5% in Q1, reversing the previous quarter’s 2.4% growth, according to the latest BEA estimate. The sharp downturn was largely attributed to weaker consumer spending, a decline in exports, and a jump in imports. Despite the growth setback, inflation showed persistence—PCE rose 3.7% while core PCE increased 3.5%, both revised slightly higher. These inflation metrics reinforce the Federal Reserve’s reluctance to rush rate cuts, keeping real yields elevated and capping gold’s upside.

Durable Goods Orders Surprise to the Upside

In contrast to GDP weakness, May durable goods orders surged 16.4%, driven by a 48.3% spike in transportation equipment. While the headline figure was impressive, underlying strength was more muted—excluding transportation, orders rose just 0.5%. This selective industrial strength sparked a rally in risk assets, with the S&P 500 and Nasdaq trading near record levels. Rising equity appetite has diverted capital from safe-haven assets like gold.

Labor Market Sends Mixed Signals

Initial jobless claims dropped by 10,000 to 236,000 last week, suggesting short-term labor stability. However, continued claims rose to 1.974 million—the highest since 2021—highlighting softness in rehiring and longer-term employment trends. Traders remain wary that persistent labor market weakness could eventually pressure consumption and growth, offering potential medium-term support for bullion if Fed dovishness returns.

Fed Tone Limits Bullion Breakout Potential

Fed Chair Jerome Powell reiterated a cautious stance in his congressional testimony, stating there is no urgency to cut rates given inflation’s resilience. Markets are still pricing in an 85% chance of a September cut, but near-term policy remains data-dependent. Until inflation eases more convincingly, real yields are likely to stay elevated, dampening gold’s appeal in the short run.

Gold Prices Forecast: Bearish Bias Below Key Support

With XAU/USD slipping back below its recent highs and failing to hold momentum, traders are eyeing near-term support at $3310.48 and the weekly low at $3295.31. A break below these levels could open the door to a test of $3245.56 to $3228.38. Upside remains capped near $3381.80, where sellers may re-emerge if risk appetite persists. Unless inflation cools or labor stress deepens further, the near-term outlook for gold leans bearish.

More Information in our Economic Calendar.