Crude oil update: Oil down and gold up after GDP report

Much awaited US quarterly GDP figures were released by the US Commerce Department on Friday. The report showed modest US economic growth for this quarter of 2% which is greater than the previous quarter’s figure of 1.7% but less than the economists estimated figure of 2.1%.

This modest increase in the GDP impacted the price of oil and gold. Crude oil for December delivery lost 75 cents, 0.9%, to close at $81.43/barrel. Oil traders sold the positions they had taken earlier in the week expecting an increase in oil prices after the release of GDP figures. Strengthening of the USD also didn’t help oil prices either. USD is currently very volatile as the market waits for the Fed’s meeting next week to reveal the size and scope of QE2 and how it will affect the USD.

Gold continued its rally for second consecutive day as the US GDP fell short of expectations. Gold for December delivery closed at $1,357.60 per troy ounce, up 1.1% or $15.1.