Gold price holding gains as U.S. housing starts fall 0.7% in October
(Kitco News) -The gold market is holding near session highs as momentum inU.S. home construction weakened last month.
The housing market was a pillar of strength for the U.S.economy during the COVID-19 pandemic last year; however, volatility appears tobe creeping into the sector.
Housingstarts dropped 0.7% to a seasonally adjusted annual rate of 1.52 million unitslast month, the Commerce Department said on Wednesday. The data was weakerthan expected; according to consensus forecasts, economists expected relativelystable activity at 1.58 million units.
September’sdata was also revised lower to 1.53 million units, down from the previousestimate of 1.56 million.
Forthe year housing starts were up 0.4% from October 2020.
Whileoff its highs, the gold market is still holding in solidly positive territory.December gold futures last traded at $1,864 an ounce, up 0.53% on the day.
Meanwhile,building permits, a precursor to future projects, rose 4.0% to 1.65 million in October.The data was in line with expectations. For the year permits are up 3.4%
AndrewGrantham, senior economist at CIBC, noted that some home builders have notedthat the ongoing labor shortage and rising prices for materials as been animpediment to activity.
“The gap between permit applications and starts could be a signof that, as is the still rather lackluster pace of completions,” Grantham added.“Single family starts fell and were at the lowest level in over a year, whichisn't a great sign for the residential construction segment of GDP.”
By Neils ChristensenFor Kitco News
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