On Wednesday, from 20:15 to 22:00 Beijing time, the U.S. will release a series of key economic data, including April ADP employment numbers, Q1 GDP, and March PCE, among others. The performance of this data is highly anticipated by the market, and Trump's tariff policy may have a significant impact on it, with current market expectations being mixed.
In terms of data outlook, the JOLTS job openings data released on Tuesday fell to its lowest level since September last year, indicating that the demand in the U.S. labor market is weakening. However, the number of layoffs has decreased, and the resignation rate has increased, reflecting that there is still some resilience in the labor market. The market generally expects that April ADP employment numbers will drop from the previous 155,000 to 115,000. As for the more critical non-farm payroll data on Friday, the market expects employment growth to further slow down, while the unemployment rate may remain unchanged.
Q1 GDP data is expected to show a significant slowdown. The U.S. trade deficit in March reached a staggering $162 billion, setting a new historical high, which poses considerable pressure on GDP growth. Several economists have downgraded their forecasts for Q1 GDP, with the most pessimistic prediction suggesting a contraction of 2.4%. Additionally, the U.S. consumer confidence index for April has fallen to its lowest level since 2011 and has declined for five consecutive months, indicating that consumer spending may have less of a driving effect on economic growth.
In terms of inflation data, the March PCE data is expected to show that the core month-on-month growth rate may slow from 0.4% to 0.08%, with the overall inflation level nearly unchanged. However, Trump's tariff policy may change the trend of inflation. The increase in tariffs will raise the cost of imported goods, which may drive prices up and put upward pressure on inflation. For the Federal Reserve, next week's interest rate decision meeting is expected to maintain interest rates, but the performance of these economic data will undoubtedly provide important reference for its subsequent monetary policy formulation.
From a market impact perspective, if the U.S. economy unexpectedly contracts, it will intensify market concerns about an economic recession, thereby increasing expectations for Federal Reserve rate cuts. In this case, the dollar may depreciate, while gold prices are likely to reach new highs. Conversely, if the slowdown in the economy is less than expected, the market and the dollar will gain some breathing room, and gold bears may take the opportunity to exert pressure. Due to the importance of Friday's non-farm payroll data, current traders generally maintain a cautious attitude, which has somewhat limited the volatility of gold prices.
Currently, the dollar remains strong due to the uncertainty surrounding tariff policies and trade negotiations. From the technical indicators of gold on a daily basis, the bulls still hold a certain advantage, with the support level in the range of $3300 - $3290 and the resistance level at $3328. Once the upper resistance is broken, gold prices are expected to challenge higher levels. Investors should closely monitor the release of this data to timely adjust their investment strategies.
