Gold futures rebounded in New York after a government report showed U.S. economic growth stalled last quarter, boosting demand for the metal as a haven.
Gross domestic product grew at a 0.1 percent annualized rate from January through March, compared with a 2.6 percent gain in the prior quarter, the Commerce Department said. Through yesterday, gold climbed 7.8 percent this year amid signs that the U.S. economy was faltering. Slowing growth also gives the Federal Reserve more leeway to continue monetary stimulus. The central bank ends a two-day policy meeting today.
“The GDP number was very disappointing, and some people are buying into the bad data,” Tommy Capalbo, a broker at Newedge Group in New York, said in a telephone interview. “Every time there is a bad number, people begin to wonder if the Fed will rethink the tapering plan.”
Gold futures for June delivery slid 0.2 percent to $1,293.20 an ounce at 8:47 a.m. on the Comex in New York. Earlier, prices fell as much as 0.9 percent.
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