(Kitco News) - The gold market continues to struggle and is unable to find any bullish traction following disappointing housing sector data.
Residential construction increased by 1.6% last month to a 1.361 million annualized rate, up from March’s revised rate of 1.339 million, the U.S. Commerce Department said on Friday. The latest housing market data rose in line with economists’ expectations.
The report said that housing starts are down 1.7% compared to last year’s activity.
The report also said that single-family home construction remains muted, falling 2.1%
The gold market is not seeing much reaction to the latest housing data. Spot gold last traded at $3,174.50 an ounce, down 2% on the day.
While construction activity increased last month, the housing sector could continue to struggle as a drop in building permits points to further declines through the summer.
The report said the pace of issued building permits dropped to 1.412 million, down 4.7% from 1.481 million permits issued in March. The decline missed consensus expectations as economists were looking for a small drop to 1.45 million permits.
Economists continue to monitor the U.S. housing sector, which is a significant factor in GDP. The sector has struggled, as higher interest rates have driven mortgage rates higher, while low inventories have driven prices higher, keeping many potential buyers out of the market.
Economists note that a slowing economy could put more pressure on the housing market as fewer consumers will be in a position to afford a home.
