Gold prices remain neutral near six years high after weak US pending home sales
( Kitco News) – Gold prices remain stable in neutral territory after fewer consumers started the process of buying a new home, according to the latest data from the National Association of Realtors (NAR) ).
On Thursday, the association said the pending home sales index fell by 2.5% in July, compared with June's 2.8%. The numbers were weaker than expected, as economists expected to see an unchanged reading.
Gold prices hovered near the peak of the report for the past six years and see little movement in the initial reaction to the disappointing employment data. Gold futures in December last traded at $ 1[ads1],550 an ounce, relatively unchanged on the day.
Economists are closely watching the pending housing sales figures because the index is seen as a barometer for the housing market. A delay of a month or two usually exists between a contract and a completed sale.
The housing sector has been a drag on US economic growth for almost a year and lower mortgage rates, due to falling interest rates have not been enough to spur new spending. Pending housing sales, it was 0.3% lower during the 12 months through July.
Super-low mortgage rates have yet to consistently pull buyers back into the market, says Lawrence Yun, NAR's chief economist. "Economic uncertainty undoubtedly holds back some potential demand, but what is sorely needed is more supply of moderately priced homes."
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