Gold Prices See Little Reaction To Modest Rise In Flash PMI Data
(Kitco News)- Goldprices were largely unchanged seeing modest selling pressure followingstronger-than-expected preliminary data for the U.S. manufacturing and servicesector
Theflash U.S. manufacturing Purchasing Managers Index for October rose to areading of 55.9, up from September's reading of 55.6, research firm IHS Markitsaid in its latest report. Economists were expecting a modest decline to 55.5.
Atthe same time, the firm's service sector PMI rose to 54.7, compared to September'sreading of 53.5. Economists were expecting the index to rise to 54.1.
Monthlyreading above 50 points to an expanding sector, while anything below that showscontraction in activity.
Goldprice were seeing some modest selling pressure after hitting a three-month highTuesday and are relatively unchanged in initial reaction to the latest economicdata. December gold futures last traded at $1,233.10 an ounce, down 0.30% onthe day.
Thereport noted that positive sentiment in the manufacturing sector has hit athree-month high; meanwhile sentiment in the service sector is at its highestlevel in two months.
Although the report noted that businesses are still concerned about global demand in the face of escalating tradewars, it also said that domestic demand is a dominant growth factor for bothsectors.
“Theresilience of the domestic economy in the face of trade worries, and the strongprice pressures indicated by the survey data, will add to expectations that theFed will hike rates again before the end of the year,” said Chris Williamson,chief business economist at IHS Markit. “The flash PMI surveys indicate thatthe pace of economic growth gained momentum again in October after having beensubdued mainly by adverse weather in September. The headline PMI is running ata level broadly consistent with the economy growing at an annualised rate of2.5%, boding well for another robust quarter of growth.”
By Neils ChristensenFor Kitco News
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