Gold Prices Ignore 12% Meltdown In U.S. Housing Construction
(Kitco News)- Goldprices remain under pressure hovering near a 12-month low Wednesday as the latestU.S. housing data weakened more than expected.
TheCommerce Department's latest economic data showed that U.S. housing starts fell12.3% in to a seasonally adjusted annual rate of 1.17 million units in June,down from May's revised rate of 1.3 million. Consensus forecasts compiled bymost news organizations called for starts to be around 1.32 million.
According to reports, housing starts have fallen to a nine-month low.
Annually,housing construction dropped 3% from June 2017.
Meanwhile,the Commerce Department said the tally of building permits - important as anindicator of future construction activity - fell by 2.2% lastmonth to an annualized rate of 1.273 million, down from May's revisedrate of 1.312 million. Economists were expecting to see an increase to 1.32million.
However, the disappointing data haven't had much of an impact on gold prices, which have been mired in athree-month downtrend. Economic data are not having much impact on gold asinvestors are laser-focused on surging momentum in the U.S. dollar
Augustgold futures last traded at $1,224.60 an ounce, down 0.24% on the day.
Accordingto some economists, the housing market faces strong headwinds as rising interestrates boost mortgages, forcing some first-time home buyers out of themarketplace.
KatherineJudge, senior economist at CIBC World Markets, dismissed theweaker-than-expected report, highlighting the fact that construction is stillat healthy levels.
“Builderconfidence remains intact as indicated by the elevated NAHB homebuilding indexand robust price growth should continue to incentivize homebuilding goingforward,” she said.
By Neils ChristensenFor Kitco News
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