Gold Prices See Little Reaction To Modest Drop In U.S. Flash PMI Data
(Kitco News) - The gold market remains in negative territory and is seeing little reaction to weaker preliminary sentiment data in both the manufacturing and service sector data.
The flash U.S. manufacturing Purchasing Managers Index for November fell to a reading of 55.4, down from October’s reading of 55.7, research firm IHS Markit said in its latest report. Economists were expecting a modest decline to 55.8.
At the same time, the firm’s service-sector PMI fell to 54.4, compared to October’s reading of 54.8. Economists were expecting the index to rise to 55.0.
Monthly reading above 50 points to an expanding sector, while anything below that shows a contraction in activity.
Activity in the gold market has been fairly quiet because of Thursday’s Thanksgiving holiday. The market is seeing little reaction to the latest U.S. economic data. December gold future while off their lowest remain in negative territory, last trading at 1$,225 an ounce, down 0.24% on the day.
The reported noted that optimism in the service sector dropped to a two-month low; meanwhile, sentiment in the manufacturing sector was more pessimistic, falling to a three-month low.
"The surveys are broadly consistent with the economy growing at an annualized rate of 2.5%, building further on the country’s best growth spell since 2014 seen in the second and third quarters," said Chris Williamson, Chief Business Economist at IHS Markit. "The November survey does raise some warning flags to suggest growth could slow in coming months. In particular, growth of hiring has waned as companies grew somewhat less optimistic about the outlook. Goods exports also appear to also be coming under increasing pressure, often linked to trade wars having dampened demand."