Gold prices trimmed earlier losses on Wednesday after weaker U.S. economic data raised expectations of interest rate cuts.
Spot gold fell 0.2% to $3,308.32 an ounce by 1:58 a.m. ET but remained up 6% for April. Gold had dropped over 1% earlier in the session before bouncing back.
U.S. gold futures settled 0.4% lower at $3,319.10 an ounce. Despite the decline, gold is set for its fourth monthly gain.
The latest U.S. economic data revealed a surprise contraction in GDP. The economy shrank at a 0.3% annualized rate last quarter.
Businesses had rushed to import goods, anticipating tariffs from the Trump administration, which likely skewed the figures.
“Gold remains bullish,” said independent metals trader Tai Wong. “Today’s U.S. economic data increases chances for initial Fed rate cuts.”
Although gold has recently surged to $3,500, Wong believes prices may trade sideways before rising again.
Investors are betting the Fed may cut rates by a full percentage point before year-end, especially if weakness continues.
Low interest rates usually benefit gold, which doesn’t yield income and performs well during financial or political uncertainty.
Gold last hit a record $3,500.05 on April 22 following strong market demand and economic concerns.
Additionally, U.S. economic data on the PCE index showed prices remained flat in March after a 0.4% rise in February.
However, core PCE, which excludes food and energy, rose 3.5% annually—an increase from the previous quarter’s 2.6%.
Despite this, gold held firm, lifted by the earlier GDP surprise, which overshadowed inflation concerns.
Now, traders await Friday’s U.S. jobs report, another major release that could shape the Fed’s rate outlook.
Meanwhile, silver fell 1% to $32.64 per ounce, platinum declined 1.2% to $965.30, and palladium gained 0.3% to $937.75.
China’s markets will remain closed May 1–5 for the Labour Day holiday, reducing global market activity.
For more gold price updates, visit DC Brief.
