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Gold Surges After Dismal Retail Sales

Gold futures surged Tuesday as mixed economic data dented the U.S. dollar and lowered expectations for agressive rate hikes from the Federal Reserve.

Gold jumped $27.60, or 2.1%, to settle at $1,358 an ounce, taking back recent losses.

A downbeat retail sales report hinted that the economy may be in worse shape than once imagined.

The Commerce Department said retail sales fell by 0.3 percent in January compared to economist estimates for a 0.2 percent uptick in sales.

"Overall, some of the weakness in January retail sales could be linked to the unusually high number of reported flu cases last month but, on balance, it was probably inevitable that sales would start to slow after their recent strength," Andrew Hunter, U.S. Economist at Capital Economics.

The news overshadowed today's closely-watched inflation report.

The Labor Department said its consumer price index climbed by 0.5 percent in January after edging up by a revised 0.2 percent in December.

Economists had expected consumer prices to rise by 0.3 percent compared to the 0.1 percent uptick originally reported for the previous month.

by RTT Staff Writer

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