Gold has posted considerable losses on Tuesday, erasing the gains seen on Monday. In North American trade, the spot price for one ounce of gold is $134.52, down 0.56% on the day. In economic news, Building permits slowed to 1.30 million, shy of the estimate of 1.32 million. Housing starts also slowed, falling to 1.16 million, down from 1.23 million in the previous release. There was more bad news, as CB consumer confidence fell sharply to 124.1, well below the estimate of 132.1 points.
U.S. data was softer than expected on Tuesday, but gold failed to take advantage. Gold gained ground last week and posted more gains on Monday, as risk apprehension has since the Federal Reserve policy meeting last week. At the meeting, policymakers were sharply dovish, indicating that the Fed planned to hold interest rates for the remainder of the year. As well, the Fed lowered its growth forecast for 2019 to 2.1%, down from 2.3% in December. There was more bad news on Friday, as the spread between 3-month and 10-year Treasury notes turned negative for the first time since 2007, pointing to an inverted yield curve, which could point to a recession. All eyes will be on U.S. Final GDP, which will be released on Thursday. If GDP misses the forecast of 2.4%, investors could get jittery and flee to the gold, a traditional safe-haven asset.