Gold price turned sharply lower with disappointing U.S. economic data continued!?

The gold price turned sharply lower in mid-day trading on Tuesday as the U.S. dollar surged higher against a basket of foreign currencies. COMEX gold futures sunk from above $1,580 to as low as $1,553 per ounce.

U.S. equity markets moved higher, however, on the heels of a broad-based rally in European markets on Tuesday.  The Dow Jones Industrial Average (DJIA) climbed 112.50 points, or 0.9%, to 12,567.33 while the S&P 500 Index added 9.77 points, or 0.7%, to 1,327.59.  Investor risk aversion nonetheless held steady, with the CBOE Volatility Index (VIX) oscillating between gains and losses near 21.76.

The recent trend of disappointing U.S. economic data continued this morning with the latest data on the housing market.  The Case-Shiller index fell 2.6% on a year-over-year basis in March, which matched the consensus estimate among economists.  However, the home price measure also reached its lowest level since 2002 and reminded investors of the considerable headwinds that continue to plague the U.S. economy.

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