Consumer spending in the United Sates advanced more than expected last month as households boosted purchases of motor vehicles and services amid increasing wages. On Monday, the Commerce Department reported consumer spending rose 0.5% in December, following the preceding month's 0.2% rise and surpassing a 0.4% increase forecast. The stronger than expected figure pointed to solid domestic demand that is expected to boost economic growth in early 2017. Data showed purchases of manufactured durable goods climbed 1.4% last month, while consumer spending on services jumped 0.4%. Meanwhile, personal income increased 0.3% month-over-month in December after rising 0.1% in the prior month. However, economists expected household income to climb 0.4%. Salaries and wages grew 0.4% in December after dropping 0.1% in November. For all of 2016, income climbed 3.5% after increasing 4.4% in 2015.
Separately, the Commerce Department said the PCE Price Index advanced 0.2% in December, following November's 0.1% increase. During the twelve-month period ending December, the Index rose 1.6%, the largest increase since September 2014, up from the previous month's 1.4% rise. Excluding volatile items, the Core PCE Index grew 0.1% after being unchanged in November, in line with analysts' expectations.
Upcoming events: Various medium impact releases
Data, which will affect the strength of the US Dollar will be coming in the second half of the day. At 13:30 GMT the US Employment Cost Index is set to be published. At 14:45 GMT the Chicago PMI will be out. Afterwards, at 15:00 GMT the US CB Consumer Confidence is set to be released.
Gold reaches above 1,200 on Tuesday
Daily chart: The yellow metal continues to surge, as political uncertainty increases demand for a safe haven investment. However, from a technical perspective, it seems that the 20-day SMA was strong enough to push the yellow metal higher. In addition, during the move the bullion broke through the resistance put up by the weekly PP, which is located at 1,196.86. Due to that reason the commodity price might rise up to the weekly R1 at 1,213.16, as there are no other levels of resistance up to that mark.SWFX traders almost neutral
Spreads (avg,pip) / Trading volume / Volatility
Market participants foresee the price of Gold being around 1,250 in May
Traders who were asked regarding their longer-term views on gold between December 31 and January 31 expect, on average, to see the metal near 1,250 in early April. Generally, 45% (-2%) of participants believe the price will be above 1,250 in ninety days. Alongside, 37% (+1%) of those surveyed reckon the currencies will trade in the range between 1,000 and 1,200 over the next three months.