Gold has posted slight gains on Thursday. In North American trade, the spot price for an ounce of gold is $1285.21, up 0.27% on the day. Gold prices have steadied, but are still 1.0% lower this week. On the release front, key indicators were mixed. GDP expanded 3.1%, beating the forecast of 3.0%. Unemployment claims jumped to 272 thousand, higher than the estimate of 269 thousand. On Friday, the US releases Personal Spending and UoM Consumer Sentiment.
The US economy continues to perform well, as Final GDP for the second quarter posted an impressive gain of 3.1%. This figure was revised upwards from the second estimate of 3.0% in August. However, September and third quarter economic numbers could soften, due to the damage caused by hurricanes Harvey and Irma, which caused a slowdown in economic activity. The recent hurricanes have impacted on the labor market, pushing unemployment numbers higher. Still, the labor market remains strong, as underscored by unemployment rolls which have remained below the 300,000 level.
President Trump has all but given up on his health care proposals, as the plan lacks enough support from Republican lawmakers. Trump has now set his sights on tax reform, another key campaign promise. On Wednesday, Trump proposed a major overhaul of the US tax code, which includes reducing the corporate tax rate from 40 percent to 20 percent, as well as a 25 percent tax rate for small businesses, such as partnerships. Like other Trump proposals, the tax plan was sketchy on details, including how the tax plan would be paid for. With Democrats and some Republicans wary of Trump’s tax agenda, it’s likely his that tax reform proposal will face a stiff battle in Congress.
