(Kitco News) Gold prices dropped to fresh daily lows following better-than-expected retail sales data from September.
U.S. retail sales rose 0.7% last month following an upwardly revised increase of 0.9% in August, according to the latest data from the U.S. Commerce Department. Economists were expecting to see a decrease of 0.2% in last month's headline number.
Core sales, which strip out vehicle sales, were up 0.8% last month versus the expected advance of 0.5%. The report's control group, which strips out autos, gas, building materials, and food services, also rose 0.8%, beating expectations of 0.4% gain.
Immediately after the publication, December Comex gold futures dropped to new daily lows, last trading at $1,773.50, down 1.36% on the day.
Analysts were not as optimistic when digesting the data, suggesting that retail sales were boosted by higher prices and not by better consumption.
"Auto sales were up, in contrast to the unit sales data, reflecting higher prices of vehicles sold. Gasoline sales also contributed to the upside surprise, with the gain also magnified by price increases," said CIBC Capital Markets economist Katherine Judge. "While that leaves sales in the control group up by 3.4% annualized over the third quarter, that is magnified by price gains, and unit auto sales were down sharply, suggesting growth in real goods consumption was still sluggish in Q3."
By Anna GolubovaFor Kitco News
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