Gold Prices Remain Down; Ignore Rise In ISM Manufacturing Index
(Kitco News) - Gold prices remains under pressure but is seeing little reaction to stronger than expected sentiment within the manufacturing sector, according to the latest data from the Institute for Supply management (ISM).
Friday, the ISM said its manufacturing index showed a reading of 58.7% for May, up from April reading of 57.3%. The data beat expectations as economists were looking for a reading of 58.3%
It’s not surprising to see the gold market ignore the latest manufacturing sentiment data as the market is digesting stronger than expected labor market data. June gold futures dropped after the The Bureau of Labor Statistics said 223,000 jobs were created last month, beating expectations for gains of 180,00.
August gold futures last traded at $1,298 an ounce, down 0.51% on the day.
Looking at the components of the report, the New Orders Index increased to a reading of 63.7%, up from April’s reading of 61.2%; at the same time, the Production Index increased to 61.5%, up from the previous level of 57.2%.
The labor market also saw an improvement with the Employment Index increasing to 56.3%, up from April’s reading of 54.2%.
Positive for the gold market, the report showed growing inflation pressures within the manufacturing sector. The Price Index increased to 79.5%, up slightly from April’s reading of 79.3%.
“The Prices Index is at its highest level since April 2011, when it registered 82.6 percent,” the report said.