Lots of economic news coming out this morning paints a picture of a U.S. economy that isn't as spooked over the Fiscal Cliff as was once supposed. Durable Goods orders came in higher than expected after all the news about companies holding off on capital purchases over economic uncertainty relating the the budget negotiations in Washington. House prices showed the expected rise, and consumer confidence took a big jump to a four-year high.
This is having the short-term effect of depressing gold prices, as the urge to seek a safe haven asset lessens. Paradoxically, the broader market has dipped into negative territory as well. Of course, the big question is whether we will see meaningful debt and deficit reform out of Washington, or (more likely) another attempt to kick the can down the road as the underlying problems multiply. Look for gold to test for a new floor today, perhaps at $1,739/oz. The recent trends for investors to "buy on the dip" may limit the downside today.