Gold Price Forecast: XAU/USD trades lower near $2,040 on downbeat China data

Gold price hovers lower around $2,040 per troy ounce during the Asian session on Thursday. The yellow metal has retreated from the six-month high it reached at $2,052 on Wednesday. The pullback in Gold's price suggests a shift in market sentiment or profit-taking after the recent rally.

Gold encountered challenges as the US Dollar (USD) saw a modest rebound. The US Dollar Index (DXY) struggles to sustain its gains, hovering around 102.80 at the moment. The US Dollar (USD) successfully halted its four-day losing streak in the previous session, thanks to stronger-than-expected US Gross Domestic Product Annualized data released by the US Bureau of Economic Analysis. The US GDP Annualized increased by 5.2% during the third quarter, surpassing the previous reading of 4.9% and exceeding the market consensus of 5.0%.

Furthermore, Cleveland Federal Reserve (Fed) President Loretta Mester expressed that monetary policy is currently in a favorable position to evaluate upcoming data on the economy and financial conditions. While Mester did not rule out the possibility of further rate hikes, she emphasized that the decision to implement additional hikes would data-dependent.

The NBS Manufacturing PMI for November declined to 49.4 from the previous reading of 49.5, falling short of the expected increase to 49.7. Moreover, the Non-Manufacturing PMI contracted to 50.02, below the expected 51.1 and the previous reading of 50.6. These data points indicate a contraction in both manufacturing and non-manufacturing activities in China, which could impact global economic sentiment and contribute to a stronger US Dollar, putting pressure on Gold prices.

Looking ahead, the United States is scheduled to release crucial economic data later in the North American session. Significant data include the Initial Jobless Claims for the week ending on November 24, with an expected increase to 220,000 from the previous 209,000. Additionally, the Core Personal Consumption Expenditure (PCE) Price Index for October will be released, with expectations of a slowdown in consumer inflation. The anticipated annual rate is expected to decrease from 3.7% to 3.5%.