Gold Ignores Soft Flash Manufacturing And Service Sector Data
(Kitco News) - Gold prices remain relatively unchanged on the day following a weaker-than-expected reading in preliminary U.S. manufacturing and service data.
Friday, research firm IHS Markit, said that its flash Purchasing Managers Index for April, fell modestly to a reading of 52.8, down from March final reading of 53.3. Economists were expecting to see a modest rise, with consensus forecasts calling for a reading of 53.9.
At the same time the firm’s service sector PMI showed a reading of 52.5 following March’s reading of 52.8. Economists were expecting the index to rise to 53.7.
The report noted that private sector growth has eased to its lowest level in seven months.
Gold prices were hovering around unchanged on the day and have remained at those level in initial reaction to the data; June Comex gold futures last traded at $1,284.40 an ounce.
According to IHS economists the data points to moderate growth in the second quarter; however momentum could pick up as sentiment in U.S. remains strong.
“The PMI data suggest the US economy lost further momentum at the start of the second quarter. The surveys are signalling a GDP growth rate of 1.1% after 1.7% in the first quarter,” Chris Williamson, chief business economist at IHS Markit. “The survey responses indicate that some froth has come off the economy since the post-election bounce seen at the end of last year. However, with inflows of new business picking up slightly in April and business optimism about the year ahead also brightening, there’s good reason to believe that growth could revive again in coming months.”