Gold prices are trading sideways in the Monday session. Currently, the spot price for an ounce of gold is 1347.25, down 0.02% on the day. There are no US releases on Monday, as bank and stock markets are closed for Presidents Day.
Volatility in the stock markets last week translated into gains for safe-haven assets such as gold. The base metal gained 2.3%, as nervous investors lost their appetite for risk. On Friday, gold lost ground but managed to briefly push above $1360, for the first time since late January. US fundamentals have been generally strong, pointing to a robust US economy. This has raised speculation of a quicker pace of rate hikes from the Fed, but gold has managed to hold its own against the US dollar, largely due to the recent stock market correction.
The US posted sharp housing and consumer confidence reports on Friday, but the dollar failed to make headway against the surging Japanese yen. Building Permits jumped to 1.40 million in January, up from 1.30 million in December. This easily beat the estimate of 1.29 million. Housing Starts followed suit and improved to 1.33 million in January, up from 1.19 million a month earlier. This was well above the forecast of 1.28 million. There was more positive news from consumer confidence, as UoM Consumer Confidence climbed to 99.9, well above the estimate of 95.4 points.
