Gold Ends Higher As Dollar Declines

(RTTNews) - Gold futures ended higher Monday, on safe haven demand after the dollar trended lower on some mixed economic data from the U.S. with pending home sales pulling back more than expected in August.

Investors digested a mixed batch of U.S. economic data including a report showing consumer spending to have risen more than expected in August.

A report from the National Association of Realtors showed pending home sales in the U.S. to have dropped more than expected in August, even as personal spending in the U.S. rose more than expected in August.

A weak report on eurozone economic confidence and sluggish commodity prices are weighing as well.

Worries about the ongoing conflict in the Middle East and news about clashes between the police and pro-democracy protesters in Hong Kong appear to be hurting the market.

Investors await this week's deluge of U.S. economic data, with gold falling sharply of late amid an unusually rapid strengthening of the dollar, although the dollar dropped against major rivals today.

Gold for December delivery, the most actively traded contract, gained $3.40 or 0.3 percent to settle at $1,218.80 an ounce on the Comex division of the New York Mercantile Exchange on Friday.

Gold for December delivery scaled an intraday high of $1,223.90 and a low of $1,215.80 an ounce.

On Friday, gold futures ended lower on a strong dollar after some upbeat economic news from the U.S. with its second quarter gross domestic product data rising more than previously estimated. Last week, gold dropped to its lowest since January, bottoming out at $1,208.

Holdings of SPDR Gold Trust, the world's largest gold-backed exchange-traded fund, edged down to 772.25 tons from its previous close of 773.45 tons.

The dollar index, which tracks the U.S. unit against six major currencies, traded at 85.56 on Monday, down from its previous close of 85.68 late Friday in North American trade. The dollar scaled a high of 85.80 intraday and a low of 85.46.

The euro trended higher against the dollar at $1.2687 on Monday, as compared to its previous close of $1.2683 late Friday in North American trade. The euro scaled a high of $1.2715 intraday and a low of $1.2664.

In economic news from the U.S., data from the National Association of Realtors showed pending home sales to have pulled back much more than expected in August, falling 1.0 percent to 104.7, from 105.8 in July. Economists expected pending home sales to drop by about 0.5 percent.

A report from the U.S. Commerce Department said consumer spending was up by a more than expected 0.5 percent in August. Economists expected spending to increase by about 0.4 percent compared to the 0.1 percent drop originally reported for the previous month.

Meanwhile, personal income rose by an expected 0.3 percent in August after edging up by 0.2 percent in July.

In economic news from the eurozone, survey results from the European Commission showed economic confidence index to have slipped below its long-term average of 100 in September, dropping to 99.9, from 10.6 in August.

Meanwhile, German consumer price inflation remained stable at 0.8 percent in September, preliminary data from Destatis showed Monday. This was the lowest since February 2010, when prices climbed 0.5 percent and matched economists' expectations.

Several first-tier economic data are scheduled for release in the unfolding week, including the Labor Department's non-farm payrolls report for September.

ADP's private payrolls data for September, and the results of the Institute for Supply Management's manufacturing survey are also among the highly anticipated releases. Traders expect the data will be generally positive, putting further pressure on the Federal Reserve to raise interest rates ahead of schedule.