The global financial markets are closely watching the movements in gold prices as US President Donald Trump's recent media address may significantly impact reactions to US data releases. On Thursday, the gold price traded cautiously above $2,900 in the Asian session. Meanwhile, the US Dollar has rebounded, offsetting the Japanese Yen's strength, allowing the USD/JPY pair to stage a notable comeback. The pair gained traction above 149.00, bouncing off the year-to-date lows in the Asian market.
The US Consumer Confidence Index experienced a steep decline, dropping 7 points to 98.3, marking its most substantial decrease since August 2021. This development has captured the attention of market analysts and investors alike. Nonetheless, Nvidia's positive results have buoyed broader market sentiment, as evidenced by a 0.20% gain in the US S&P 500 futures.
President Trump also shifted his message on tariffs, signaling that steep 25% tariffs on Mexican and Canadian goods could take effect on April 2. This announcement comes amidst a backdrop of disinflation becoming more widespread, although prices continue to rise rapidly in services, particularly in France and the Eurozone. This complex economic landscape has left gold buyers eyeing the psychological barrier at $2,850 as their last line of defense.
The current focus for investors remains on upcoming US data and Federal Reserve communications for potential new market impetus. In particular, Trump's conflicting messages have kept haven demand for the US Dollar robust, adversely affecting gold prices. The gold market faces a potential retest of all-time highs at $2,956 if gold buyers can push acceptance above the previous day's high of $2,930.
The Q4 US GDP revision and Federal Reserve statements are eagerly anticipated by gold traders seeking fresh direction. The second estimate of the US GDP is expected to reflect a 2.3% annualized growth rate in Q4 2024, providing further insight into the economic trajectory. Additionally, inflation appears to have eased in February, particularly in France, due to a significant reduction in regulated electricity prices.