Gold Spot Price Open: $1,221

Gold Spot Price Close: $1,241

Change in Gold Spot Price: +$20

Silver Spot Price Open: $14.79

Silver Spot Price Close: $14.89

Change in Silver Spot Price: +$0.10

After spending a good majority of last week conceding value, precious metals bounced back impressively on Monday and ended things solidly higher. When all was said and done, gold gained about twenty dollars while silver tacked on about ten cents. Platinum and palladium both gained today as well, with both metals adding closer to ten dollars.

Pending Home Sales Fall in January

The housing market of the United States has been one of the bright spots for the US economy in recent months. While other sectors of the US economy begin to perform poorly, the US housing market has been resilient. Today we are seeing that perhaps the housing market is not as strong as once thought thanks to a report claiming that pending home sales fell by a considerable margin during January.

According to the National Association of Realtors, pending home sales in January fell 2.5% bringing the index’s reading down to 106. This was particularly poor news seeing as December’s pending home sales index was revised upward to nearly 109. For gold and silver, today’s poor real estate data was perceived as being good news more than anything else because it is solidifying the belief that perhaps the US economy is slowing down. With that being said, some other people are attributing January’s poor home sales readings to the massive blizzard that struck much of the eastern half of the country.

Lawrence Yun, chief economists for the NAR, commented on today’s data by saying, “While January’s blizzard possibly caused some of the pullback in the Northeast, the recent acceleration in home prices and minimal inventory throughout the country appears to be the primary obstacle holding back would-be buyers.” As we move through the month of March, it will be interesting to see what happens to the US real estate market. For now, investors are holding their positions and are not exactly quick to make any major moves.

More Bad News for the European Economy

According to reports released earlier today, prices across the Eurozone continue to fall, and this is not good news for inflation. In fact, the recent decline of prices has prompted many European investors to seriously ponder what the ECB may do to combat falling prices and a worsening outlook on regional inflation.

After consumer prices finally rose out of the negatives in January, things quickly reverted back to their old ways in February. Officially, consumer prices moved to -.2% in February, falling from a positive reading of .3% in January.

Even Core Inflation, which does not account for more volatile aspects of the economy, fell by .3% to a reading of .7% for February. For consumer prices across the board, today’s data marked the worst reading since February of last year while core inflation was at its lowest point since last April.

With the European Central Bank gearing up for its monthly meeting next week, one cannot help but wonder if further stimulus measures are in the cards. As it stands, a large portion of investors cannot envision a scenario where next week’s meeting does not lead to further stimulus.

Wrap-Up

All in all, the first trading day of the week and last trading day of February went exactly how we thought it would. A good bit of economic data was reported today and that much will likely remain a theme through the rest of the week. For precious metals, a continuation of weak data may be exactly what spot values need to gain back what was lost during last week’s 5-day trading session. As for what the rest of the week has in story, experts are paying attention to few things other than the upcoming non-farm jobs data that is due out by the end of the week.