On Wednesday, Gold futures declined to their lowest level in more than 2 weeks. This extended losses from earlier this week which came about as a result of a relatively flat U.S. dollar (USD).
The price of the precious metal was impacted by the stalled talks regarding Greece’s debt crisis while the report regarding the revised estimates of contractions in the 1st quarter in the U.S. economy, did very little to support the commodity.
Gold for delivery in August traded at 1,173.00 a troy ounce, down 0.31%, or 3.60, on the Comex division of the New York Mercantile Exchange. This marked the 5th decline for gold over the last 5 consecutive sessions while Wednesday marked the lowest closing level for the yellow metal since the 5th of June, where the price declined below $1,170 a troy ounce.
Gold futures were met with resistance from its high of 1,190.20 reached on the 15th of June while support was at 1,162.10, the low from the 5th of June.
On Wednesday, the Bureau of Economic Analysis (BEA) in the Department of Commerce in the U.S. upgraded its GDP growth estimate for the first quarter. This was changed from an initial projection of negative 0.7% to a negative annual rate of 0.2 percent.
According to the Bureau, in the first quarter, the decrease in the real GDP reflected primarily negative contributions from exports, state and local government spending as well as non-residential fixed investment. As a result of the positive contributions from residential fixed investment, private inventory investment as well as Price Consumptions Expenditures, the downside pressures were partially offset.
It is important to note that in the first quarter, GDP growth is typically slow as a result of seasonal factors. In the first quarter last year, the economy in the U.S. experienced even sharper losses as GDP declined by more than 2 percent.
Meanwhile, in July 2015, the advanced estimates for the GDP in the 2nd quarter will be released. Analysts currently anticipate a growth of between 2 and 3 percent during the period.
MT4 Chart: Gold