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Gold Ignores Soft Flash Manufacturing And Service Sector Data

Kitco News

(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.”

Disclaimer: The views expressed in this article are those of the author and may not reflect those of Kitco Metals Inc. The author has made every effort to ensure accuracy of information provided; however, neither Kitco Metals Inc. nor the author can guarantee such accuracy. This article is strictly for informational purposes only. It is not a solicitation to make any exchange in commodities, securities or other financial instruments. Kitco Metals Inc. and the author of this article do not accept culpability for losses and/ or damages arising from the use of this publication.

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