Shutterstock photo
Markets

Gold jumps up on soft U.S. retail sales report

Shutterstock photo

Shutterstock photo

Investing.com -

Investing.com - Gold prices spiked on Wednesday after U.S. retail sales figures disappointed markets, which reminded investors the Federal Reserve won't rush to tighten monetary policy.

On the Comex division of the New York Mercantile Exchange, gold futures for December delivery traded at 1,314.40 a troy ounce during U.S. trading, up 0.29%, up from a session low of $1,306.10 and off a high of $1,316.20.

The December contract settled up 0.01% at $1,310.60 on Tuesday.

Futures were likely to find support at $1,283.30 a troy ounce, the low from Aug. 5, and resistance at $1,319.30, Tuesday's high.

Gold moved higher on safe-haven demand after the Commerce Department reported that U.S. retail sales came in flat last month, disappointing market expectations for a 0.2% increase.

Core retail sales, which exclude auto sales, rose just 0.1% in July, below expectations for a 0.4% gain.

The numbers softened the dollar by reminding investors that the Federal Reserve won't rush to raise interest rates after it closes its monthly bond-buying program, which is seen taking place in October.

Loose monetary policies tend to bolster gold due to its appeal as a hedge to weaker paper currencies.

Eurostat, the European Union's statistical office, reported earlier that industrial output in the euro area contracted 0.3% in June. It was the second consecutive monthly decline and confounded expectations for a 0.3% expansion, which also supported the yellow metal.

The report came one day after data showed that German economic sentiment deteriorated sharply this month, falling to a 20 month low, largely due to geopolitical tensions.

Meanwhile, silver for September delivery was down 0.31% at $19.843 a troy ounce, while copper futures for September delivery were down 1.34% at $3.112 a pound.

Investing.com offers an extensive set of professional tools for the financial markets.

Read more News on Investing.com and download the new Investing.com Stocks & Forex App for Android!

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.


The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

Other Topics

ForEx