The GDP growth rate of the United States exceeded expectations, and the theory of economic recession was slapped in the face!
Traders have increased their bets on the Federal Reserve to cut interest rates, and gold has a short-term long and short kill......
The U.S. economy grew faster than expected in the fourth quarter, ending a year that many expected to end in a recession.
According to data from the U.S. Bureau of Economic Analysis, the preliminary annualized quarterly rate of real GDP in the United States in the fourth quarter recorded 3.3%, exceeding expectations of 2%, slowing from the previous value of 4.9% and the lowest since the second quarter of 2023. This allows the U.S. economy to grow by 2.5% in 2023, up from 1.9% in 2022. The preliminary real personal consumption expenditures in the United States recorded 2.8% QoQ in the fourth quarter, higher than expectations of 2.5% and the lowest since the second quarter of 2023, compared to 3.1% in the previous reading.
At the same time, the labor market is showing signs of cooling, with initial claims for unemployment benefits in the United States recorded 214,000 in the week to January 20, the highest since the week of December 23, 2023, higher than the expected 200,000, and the previous reading was raised to 189,000 from 187,000.
U.S. short-term interest rate futures rose after the data as traders ramped up bets on a rate cut by the Federal Reserve. Spot gold short-term long and short double kill, fell below the 2010 mark and quickly recovered the decline, and refreshed the intraday high.
From 21:30 to 21:31 Beijing time on January 25, 4,529 contracts were traded in an instant, with a total contract value of $912 million.
From 21:33 to 21:34 Beijing time on January 25, 2,249 contracts were traded instantly, with a total contract value of $454 million.
The latest GDP data highlights the resilience of the U.S. consumer. Business investment and the housing market also helped drive higher-than-expected economic growth last quarter. This shattered the expectations of many Wall Street economists that the U.S. was about to fall into a recession.
While the Fed's rate hikes have burdened households and businesses, continued job growth and declining inflation have continued to drive consumer spending. Boosted by better-than-expected holiday spending, fourth-quarter data showed that the U.S. economy had maintained some momentum in the new year, raising expectations that the economic expansion was on a firmer footing.
A series of recent economic data shows that the US economy will end 2023 on a solid note, and investors are more confident that the Fed will achieve its vaunted "soft landing". The latest PMI data released on Wednesday showed that economic output hit its highest level in seven months in January. The most recent consumer spending data and December retail sales data were also higher than expected.