Gold prices see an uptick as U.S. retail sales surprise on the upside in June
(Kitco News) Gold prices edged up, but were still down on the day, after better-than-expected retail sales from June.
U.S. retail sales rose 7.5% in June following an upwardly revised record increase of 18.2% in May, according to the latest data from the U.S. Commerce Department. Economists were expecting to see an increase of 5% in last month’s headline number.
Immediately after the publication, August Comex gold futures edged up, last trading at $1,808.20 down 0.31% on the day.
Core sales, which strip out vehicle sales, advanced 7.3% last month, beating the expected 5% rise.
Even the report’s control group, which strips out autos, gas, building materials, and food services, was up 5.6%, also beating expectations.
Even though June saw a healthy gain in retail sales, it is already old news, as the economic recovery in the U.S. is being threatened by a growing number of coronavirus cases across the country, said CIBC Capital Markers senior economist Andrew Grantham.
“The surge in Covid-19 cases in a number of states in the second half of June, leading to a re-tightening of restrictions in some areas and likely reduction in consumers' desire to make discretionary purchases, already seems to have weighed slightly on national mobility data during the first half July,” Grantham said. “Uncertainty surrounding the size of unemployment benefits after the end of this month could also be causing consumers to be more cautious since the start of July.”