Gold Prices Unchanged Following Drop In Empire State Survey Data
(Kitco News) - The gold market is finding little traction Tuesday despite weaker than expected sentiment in the New York region's manufacturing sector, according to the latest data from the New York Federal Reserve,
Tuesday, in its Empire State Manufacturing Survey, the regional central bank said that its general business conditions index rose to a reading of 17.7 in January, down slightly from 18 in December.
However, consensus forecasts were calling for a rise to 18.5. Many economists were expecting to see a boost in sentiment in reaction to the government cutting corporate taxes to 21%.
Gold prices were already down ahead of the data, due to technical selling after the market hit a four-month high during quiet trading Monday. The market is seeing little reaction to the numbers; February gold futures last traded at $1,334.90 an ounce, unchanged on the day.
While the headline data was only slightly down from December's reading, the components of the index showed broad-based weakness.
The New Orders Index dropped to a reading of 11.9, a drop of 7.1 points from December's reading of 19. At the same time shipments fell to a reading of 14.4, down from the previous level of 23.5.
The labor market also lost momentum with the Number of Employees Index falling sharply to 3.8, a drop of 19.1 points from December's reading of 22.9.
Inflation pressures, which is favorable for gold as it is historically seen as an inflation hedge, increased with the Prices Paid Index jumping to 36.2, up 6.5 points from December's reading of 29.7.