Gold price approaches $1,830 as U.S. pending home sales disappoint in June
(Kitco News) Gold is trading near the $1,830 an ounce level as the U.S. pending home sales surprised on the downside in June.
The U.S. pending home sales were down 1.9% in June following May’s upwardly revised increase of 8.3%, the National Association of Realtors (NAR) said on Thursday. The consensus forecast called for an advance of 0.3%.
The pending home sales index was at 112.8 in June after registering 115 in the previous month. On an annual basis, pending home sales were also down 1.9% from June 2020.
Record-high home prices are weighing on the consumer sentiment, said Lawrence Yun, NAR's chief economist.
"Buyers are still interested and want to own a home, but record-high home prices are causing some to retreat," said Yun. "The moderate slowdown in sales is largely due to the huge spike in home prices. The Midwest region offers the most affordable costs for a home and hence that region has seen better sales activity compared to other areas in recent months."
Pending home sales were the strongest in the Midwest, rising 0.6%. The index also rose 0.5% in the Northeast.
Economists pay close attention to the pending home sales numbers because the index is seen as a forward-looking barometer for the housing market. A lag of a month or two usually exists between a contract and a completed sale.
Following the data release, gold edged up to daily highs, approaching the $1,830 an ounce level. August Comex gold futures were last at $1,827.60, up 1.55% on the day.