Gold prices treading water as U.S. retail sales fall 0.9% in May

NEW YORK (June 17) The gold market is trading in neutral territory below $3,400 an ounce, even as American consumers significantly cut back on their shopping last month.

U.S. retail sales dropped by 0.9% in May, following April’s revised decline of 0.1%, the U.S. Commerce Department announced Tuesday. The data came in weaker than expected, as economists had projected a 0.5% decline in the headline number.

Over the past 12 months, retail sales increased by 4.5%, the report said.

Core sales, which exclude vehicle purchases, fell by 0.3% in May, also missing expectations. Economists were forecasting a 0.2% increase.

At the same time, the control group—which excludes sales from auto dealers, building materials retailers, gas stations, and office supply stores, and which feeds directly into U.S. GDP—rose by 0.4%, exceeding expectations for a 0.3% increase.

The gold market is largely shrugging off the disappointing economic data, as investors continue to take profits following last week’s sharp rally above $3,400 an ounce. Spot gold last traded at $3,384.79 an ounce, roughly unchanged on the day.

However, some analysts suggest the weak sales data could provide support for the precious metal. Sluggish consumer spending may dampen economic growth, potentially prompting the Federal Reserve to cut interest rates, even if inflation risks remain elevated.

Adam Button, Senior Currency Strategist at Forexlive.com, described the sales data as a mixed bag.

“Overall, this is a tough series to read right now because sales jumped in March on tariff worries and have fallen in two consecutive months since,” he said.

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