Weekly Gold Price Technical Analysis: US Economic Data Reveals Mixed Signals as Inflation Subsides but Jobless Claims Rise

In the latest release of US economic data, several key indicators have presented a mixed picture, with inflation showing signs of stabilization while jobless claims reached their highest level since October 2021. Additionally, concerns over the US debt ceiling continue to escalate as the decision has been postponed, potentially leading to the country's first-ever default.

Consumer Price Index (CPI) figures for April provided some relief, showing a modest increase of 0.4%. The year-on-year (YOY) CPI to April stood at 4.9%.

Meanwhile, the Producer Price Index (PPI) for April exhibited a slight rise of 0.2%, with PPI YOY at 2.3%. These numbers suggest that inflation is gradually being brought under control, potentially alleviating concerns about rising prices.

However, the job market experienced a setback as jobless claims surged to their highest level in months. The number of claims for the month of April, recorded until May 6th, reached 264,000. More worryingly, weekly jobless claims for the same period unexpectedly rose from an estimated 3,000 claims to a staggering 22,000 claims. This sudden spike in unemployment claims raises concerns about the stability of the job market and could trigger discussions about the overall economic health of the country.

Simultaneously, the US debt ceiling issue took a new turn as the decision on spending and increasing the borrowing limit was delayed yet again. Despite a meeting held on Tuesday, no resolution was reached. Treasurer Secretary Janet

Yellen has issued a warning that, if Congress fails to raise the borrowing limit, the United States could face its first-ever default by June 1. This delay further heightens concerns about the potential consequences of a default on the country's financial stability and global standing.

In the precious metals market, a slight retreat was observed as both gold and silver eased back from their recent rapid gains. Currently, gold is priced at $2,016 per ounce, while silver stands at $24.16 per ounce. The adjustment in prices suggests a temporary pause in the bullish momentum that had propelled these precious metals in previous trading sessions.

As the US economy grapples with the juxtaposition of declining inflation but rising jobless claims, the delayed decision on the debt ceiling adds an additional layer of uncertainty to the nation's economic landscape. Observers and market participants will closely monitor future developments, hoping for favourable outcomes that can support sustained economic recovery and stability.

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