Spot gold at $4,025/oz as U.S. GDP growth rises 3.4% in Q3, core PCE rises 2.5%

The Bureau of Economic Analysis announced that the advance reading of the third-quarter Gross Domestic Product showed the economy grew 3.4% between July and September, up from 2.2% in the second quarter. The data was better than economists' expectations, as consensus forecasts were looking for a growth rate of 3.2%.

“The contributors to the increase in real GDP in the third quarter were increases in investment, consumer spending, and government spending that were partly offset by a decrease in exports. Imports, which are a subtraction in the calculation of GDP, increased,” the report said.

The BEA also noted that quarterly inflation ticked higher. The advance Core Personal Consumption Expenditures (PCE) Index for Q3 rose 2.5%, above economists’ expectation for a 2.4% print but below the 3.3% from Q2, and the advance GDP Price Index increased 2.2% quarter over quarter against expectations of a 3.2% reading, and following the 6.1% reading in Q2.

Meanwhile, September core PCE came in at 0.3%, in line with the consensus forecast and the final print from Q2.

The gold market was trading near session lows prior to the 8:30 a.m. ET release, and the yellow metal continued to trade not far from lows in the minutes afterward.

Spot gold last traded at $4,025.24 per ounce for a loss of 1.03% on the session.

Jamie Cox, Managing Partner at Harris Financial Group, said today's GDP and PCE report shows the U.S. economy is on fire right now.

"The problem is that some people are conflating inflation for growth at the moment," he said. "Ever since the Hyperscalers went free cash flow negative, there has been a dash for capital, which has caused rates to rise.  That's not inflationary, it's normal (and temporary), and should be expected."

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