Gold prices ignore weaker-than-expected U.S. pending home sales numbers
(Kitco News) - Gold prices are holding above $1,500 an ounce but seeing little reaction to more disappointing U.S. housing data as fewer consumers than expected embarked on the process of buying a new home, according to the latest data from the National Association of Realtors (NAR).
Monday, the association said that its pending home sales index rose 1.2% in November to a reading of 108.5, up from October’s revised 1.3% decline. However, the increase was less than expected as consensus forecasts showed economist forecasts looked for a 1.5% increase.
Caught in the holiday trading season, the gold market has seen little reaction to U.S. economic data. However, the precious metal is still holding above critical psychological level of $1,500 an ounce. February gold futures last traded at $1,518.40 an ounce, unchanged on the day.
Although the headline increase was less than expected, Lawrence Yun, NAR’s chief economist, said that housing market remains on solid footing. The NAR noted that contract signing is up 7.4% compared to November 2018.
“Despite the insufficient level of inventory, pending home contracts still increased in November,” said he said, noting that housing inventory has been in decline for six straight months dating back to June 2019. “The favorable conditions are expected throughout 2020 as well, but supply is not yet meeting the healthy demand.”
Economists closely watch the pending home sales numbers because the index is seen as a barometer for the housing market. A lag of a month or two usually exists between a contract and a completed sale.