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Gold Edges Higher As Feb. U.S. Retail Sales Fall 0.1%

Kitco News

Editor's Note: Updating earlier story with more details from report and comment from economist.

(Kitco News) - Gold futures ticked modestly higher after a Commerce Department report Wednesday showing that February U.S. retail sales decreased by 0.1% to $492 billion, when economists had been expecting a rise instead.

This was the third straight monthly decline in overall retail sales. Meanwhile, sales excluding autos and parts were up 0.2%.

Going into the report, consensus expectations compiled by news organizations had been for a rise of 0.4% in both overall sales and also sales excluding autos.

Comex April gold was $1.40 higher to $1,328.50 an ounce as of 8:32 a.m. EDT. Three minutes prior to reports on retail sales and the Producer Price Index, the metal had been at $1,326.10 an ounce.

“It's looking like a frosty opening to 2018 for U.S. retailers,” said Royce Mendes of CIBC. “Headline sales undershot expectations, falling 0.1% in February. While that came with an upward revision of two ticks to January's readings, more stripped-down measures were also underwhelming. With the headline dragged into negative territory by declines in both autos and gasoline, the core retailing number gain of only 0.1% came on the back of relatively broad-based weakness.”

Overall retail sales last month were 4% higher than in February 2017. Sales excluding autos were up 4.4% year-on-year.

Consumer purchases make up the single largest component of U.S. gross domestic product, thus market participants closely monitor the data as a gauge of the economy.

Disclaimer: The views expressed in this article are those of the author and may not reflect those of Kitco Metals Inc. The author has made every effort to ensure accuracy of information provided; however, neither Kitco Metals Inc. nor the author can guarantee such accuracy. This article is strictly for informational purposes only. It is not a solicitation to make any exchange in commodities, securities or other financial instruments. Kitco Metals Inc. and the author of this article do not accept culpability for losses and/ or damages arising from the use of this publication.

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