By Onome Amuge. Gold recorded its best performance in five months as the U.S. economy technically entered into a recession following a sharp decline for the second quarter in a row. At the end of the week’s trading, benchmark gold futures on New York’s Comex was up $12.60, or 0.7 percent, at $1,762.90 per ounce, after a session high at $1,765.85 per ounce. For the week, it rose 2.1 percent, its highest since a 4.2 percent gain during the week to February 25, 2022. Beyond the soon-to-expire August contract, Comex’s most active gold contract for December traded higher to settle up $12.60 on the day at $1,781.80 an ounce to hover around December’s peak of $1784.60. Gold’s bullish momentum in the week came after the commerce department reported that U.S. gross domestic product posted a negative 0.9 percent growth in the second quarter, after a contraction of 1.6 percent in first quarter GDP. The back-to-back negative quarters, according to analysts, technically places the world’s largest economy in a recession. “The U.S. economy is heading towards a recession and as long as Wall Street believes the Fed will deliver a slower pace of tightening, gold should start seeing safe-haven flows again,” said Ed Moya, analyst at online trading platform OANDA. Meanwhile, the World Gold Council (WGC), which had previously maintained a bullish view on bullion, said its outlook for the second half of the year was “mixed” at best. “Despite strong demand in the first half, investment demand, particularly from exchange-traded funds, could end the year essentially flat with 2021 demand,” the WGC said. On a positive note, the council stated that weaker equities supported by Fed rate hikes as well as fixed income investments could generate upside potential for gold as a safe haven in a recessionary environment. The WGC further projected that the yellow metal could continue rising until $1,800 if the dollar and bond yields retreat further from projections for softer Federal Reserve rate hikes through the remainder of the year. According to market data, gold, considered a hedge against inflation, has not been able to hold up to that billing for most of the past two years since hitting record highs above $2,100 in August 2020. One reason for that has been the rallying dollar index which gained 11 percent this year following a 6 percent gain in 2021. The dollar, a contrarian trade to gold, has however fallen almost 1 percent in the past days against a basket of six other major currencies, resulting in a higher valuation in the gold market.