(Kitco News)- Thegold market continues to hold on to modest gains below critical resistance, butis seeing little benefit from slowing momentum in the U.S. housing sector asfew consumers bought new homes last month.
Wednesday,the U.S. Commerce Department said that new home sales fell 5.3% in June,to a seasonally adjusted annualized rate of 631,000 homes. According toconsensus forecasts, economists were expecting to see a modest drop to 669,000units. May's data was also revised lower to a rate of 666,000 homes, down fromthe initial report of 689,000.
Accordingto many economists rising mortgage rates as a result of increasing interestrates are pricing some consumers, especially first time home buyers out themarket, leading to slower demand.
Thegold market is seeing little reaction to economic data, but is attracting somebargain hunters as prices have bounced modestly off last week's 12-month low.August gold futures last traded at $1,231.50 an ounce, up 0.49% on the day.
Despite the monthly decline, the report noted that new homesales are up 2.4% compared to June 2017.
Looking at prices, the report said the median sales price ofnew houses sold in June 2018 was $302,100; meanwhile, the average sales pricewas $363,300.
As of the end of June the estimated supply of new homes forsale stood at 301,000, representing a 5.7-month supply.
By Neils ChristensenFor Kitco News
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