(Kitco News) - The gold market continues to trade near its session highs, solidly above $4,300 an ounce, and could see further safe-haven demand as the U.S. housing sector remains extremely fragile, with the number of consumers starting the process of buying a new home stalling, according to the latest report from the National Association of Realtors (NAR).
The U.S. Pending Home Sales Index rose 0.3% in August, the NAR announced Thursday. The data were better than expected, as consensus estimates were calling for a 0.2% decline. Meanwhile, July’s contract data were revised down to show a decline of 2.6%, compared with the initial estimate of 2.3%.
For the year, the Pending Home Sales Index fell 4.7%. The U.S. housing market has struggled in recent months as the Federal Reserve has established a new monetary policy tightening bias.
On Wednesday, the Federal Reserve raised interest rates by 25 basis points, and Federal Reserve Chair Kevin Warsh signaled that the central bank still has work to do to bring inflation down to its 2% target.
The gold market is not seeing a major reaction to the mixed home sales data; however, ongoing weakness in the housing market could continue to weigh on economic activity. Spot gold last traded at $4,374.60 an ounce, up 2.7% on the day.
