Gold is trading slightly higher in the Thursday session. In North American trading, the spot price for an ounce of gold is $1279.94, up 0.21% on the day. On the release front, unemployment claims jumped to 249 thousand, well above the estimate of 235 thousand. The Philly Fed Manufacturing Index slipped to 22.7 points, short of the forecast of 24.5 points. On Friday, the focus will be on housing data, with the release of Housing Starts and Building Permits.
Investors are keeping a close eye on Congress, where the House of Representatives votes on tax legislation later on Thursday. With the Democrats fiercely against the bill, the House vote is expected to be very close. This is just the first round, as the Senate is working on its own version of a tax bill. President Trump is pushing hard for the legislation, as he desperately wants the Republicans to pass a major piece of legislation before the end of the year.
There were no surprises from key consumer spending and inflation data on Wednesday. CPI and Core CPI matched the forecasts, with gains of 0.1% and 0.2%, respectively. Consumer spending reports were a mix – retail sales gained 0.1%, shy of the estimate of 0.2%. Core Retail Sales came in at 0.2%, beating the forecast of 0.0%. The Federal Reserve would certainly like to see higher inflation numbers, which remain well below the Fed inflation target of 2.0%. Still, the markets are very bullish on additional rate hikes, as the odds of upcoming rate hikes continues to move higher. Currently, the likelihood of a rate hike in December stands at 96%, and a January raise is priced in at 94%.
