Gold Price News: Gold Edges Back Above $2,000 On Weak US Retail Sales

Gold prices ticked higher on Thursday to trade back above the $2,000 an ounce mark, after US sales figures cast doubts on the strength of the economy.

Prices climbed as high as $2,008 an ounce by Thursday afternoon, following a relatively stable day on Wednesday in which prices moved a few cents either side of $1,990 an ounce. Gold’s stronger performance on Thursday follows a sharp drop on Tuesday when prices crashed from nearly $2,030 an ounce.

Monthly US retail sales figures came out on Thursday showing a 0.8% drop in January, much lower than the market’s expected 0.1% drop. The figures pointed to a weaker-than-expected US economy last month, in turn raising pressure on the US Fed to lower interest rates – a bullish outcome for precious metals prices.

The US dollar also fell in value against other major currencies on Wednesday and Thursday, naturally boosting dollar-denominated gold prices as it makes the precious metal cheaper to buy for buyers using other currencies.

That said, the macroeconomic picture was somewhat mixed as separate weekly US initial jobless claims on Thursday came in below market expectations. Overall, the gold market appeared to pay more attention to the US retail sales figures which provided moderate support for prices.

Looking ahead, eyes will be on Friday’s monthly US producer prices index for January as well as the Michigan Consumer Sentiment figures for February, for the latest update on economic conditions.