(Kitco News) - Gold prices are trading just off session highs on Tuesday morning as the latest data showed the U.S. housing market improving in February.

New home sales increased 1.8% last month, better than the expected 0.5% increase, after an upwardly revised -6.9% print in January, the U.S. Census Bureau and the U.S. Department of Housing and Urban Development announced. 

New home sales came in at a seasonally adjusted annualized rate of 676,000 in February. The numbers were in line with forecasts, as market consensus calls expected sales to come in at 680,000 units last month. January’s sales were also revised upward to a rate of 664,000 from 657,000 units.

On an annual basis, new home sales were up 5.1% from the February 2024 estimate of 643,000. 

Looking at home prices, the median sales price for new homes last month was $414,500, and the average sales price was $487,100. As of the end of February, the inventory of houses for sale was 500,000, representing an 8.9-month supply at the current sales rate.

Economists continue to pay close attention to the U.S. housing market as it is a major contributor to economic activity. The housing sector has struggled after the Federal Reserve aggressively raised interest rates at the fastest pace in 40 years.

Along with rising mortgage rates, a lack of supply has kept housing prices elevated, pricing many potential new home buyers out of the market.

Spot gold rose to a fresh session high of $3,036.07 immediately after the 10 am EDT release, and last traded at $3,032.10, up 0.65% on the day.

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