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Gold price ticks up from daily lows as U.S. new home sales beat expectations in August

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(Kitco News) Gold edged up from daily lows after the U.S. new home sales beat expectations in August, rising 4.8% versus the expected decline of 0.1%. July numbers were also upwardly revised to an advance of 14.7%.

New home sales were at a seasonally adjusted annualized rate of 1,011,000 homes in August, the U.S. Commerce Department said on Thursday. July’s sales were revised up to a rate of 965,000 units.

Market consensus called for sales to advance to 895,000 units in August.

Gold advanced from session lows following the data release with December Comex gold futures last trading at $1,866.10 an ounce, down 0.12% on the day.

On an annual basis, new home sales were up 43.2% from last year’s estimate of 706,000 units.

Looking at home prices, the report said that the median sales price for homes sold last month was $312,800 while the average price was $369,000.

The inventory of houses for sale as of the end of August was at 282,000, representing a 3.3-month supply at current sales rate. 

CIBC Capital Markets economist Katherine Judge pointed out that new home sales rose above their pre-pandemic peak in August due to lower mortgage rates and pent-up demand. 

“[August saw] the fastest pace of sales seen since 2006, and above expectations for a slight pull back … The strong demand appears to have shifted to lower priced segments of the market, which resulted in a drop in both the median and average (NSA) sales prices. The housing sector is clearly one of the most resilient areas of the economy coming out of the pandemic, but risks remain to housing activity ahead as pent-up demand fades and the U.S. economic recovery slows,” Judge said on Thursday.

Live 24 hours gold chart [Kitco Inc.]

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