News Bites
Gold Falls Despite 0.3% Decline In Jan. U.S. Retail Sales
Editor's Note: Updating earlier story with more details from report, current prices.
(Kitco News) - Gold futures are softer despite a Commerce Department report Wednesday showing that retail sales in the U.S. decreased by 0.3% during January, falling well short of expectations.
The data normally might be constructive for gold since it portends a softer economy and thus lower prospects for interest-rate hikes. However, at the same time retail sales came out, the government released a stronger-than-forecast report on the Consumer Price Index, which was investors’ main focus going into the data releases. This CPI report hints at more rate hikes, which tends to hurt gold.
Meanwhile, January retail sales excluding autos were unchanged.
Going into the report, consensus expectations compiled by news organizations had been for a rise of 0.2% in overall sales. Sales excluding autos were forecast to be up 0.4%.
As of 8:34 a.m. EST, Comex April gold was trading down $6.80 at $1,323.50 an ounce. Five minutes before the report, the metal was at $1,333.50.
Not only did January overall sales fall, but those from December were revised lower to an unchanged reading. Initially, they had been listed as up 0.4%.
Year-on-year, January retail sales were up 3.6%.
Consumer purchases comprise the single largest component of U.S. gross domestic product, thus market participants closely monitor the data as a gauge of the economy.
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