(Kitco News) - Gold is rallying after the U.S. housing market surpassed all expectations and showed surprising strength in March, according to the latest government data.
New home sales shot up 8.8% last month to a seasonally adjusted annual sales rate of 693,000 homes, well above March’s downwardly revised rate of 637,000, which was originally reported as 664,000, the U.S. Census Bureau and the U.S. Department of Housing and Urban Development announced on Tuesday.
The data was far better than expected, as consensus forecasts looked for a 2.7% increase to a sales rate of 668,000 homes.
After spending the overnight and much of the morning in negative territory, gold prices have rallied in the wake of the housing data release. Spot gold last traded at $2,329.55 an ounce, up 0.08% on the day.
The U.S. housing sector has struggled since the Federal Reserve’s aggressive monetary policy pushed mortgage rates to multi-year highs, while a low supply of new homes is keeping prices elevated.
The report said the median sales price of new houses sold in March was $430,700, while the average sales price was $524,800.
Looking at the inventory of homes for sale, the report said there were an estimated 477,000 new houses for sale at the end of March, representing 8.3 months of supply at the current sales rate.
