Gold Ignores A 2.1% Drop In U.S. Durable-Goods Orders
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(Kitco News) - Gold prices saw little reaction to the newly released data showing U.S. orders for long-lasting factory goods dropping 2.1% in April.
Orders for durable goods declined to $248.4 billion last month, which was slightly more than expected following an upwardly revised drop of 1.7% in March, the Commerce Department said on Friday. Market consensus called for durables to fall 2%.
In response to the data, gold prices saw little movement with the June Comex gold futures last trading at $1,283.50, down 0.15% on the day.
The monthly decrease in durable-goods orders equaled to $5.4 billion and was largely led by the weakness in business investment and transportation equipment.
Meanwhile core durable goods, which strips out the volatile transportation sector, came in at 0% in April after a drop of 0.5% in March. Consensus forecasts were calling for a 0.2% increase.
The government’s durables report covers items with an expected life of at least three years, such as kitchen appliances, computers, furniture, autos and airplanes.
In April’s report there was a fall in demand for Boeing jets, new cars and trucks. Bookings for Boeing jetliners were only at four orders in April following the worldwide suspension of flights for the company’s 737 MAX planes.
Also, the annual pace of business investment slowed to 1.3% from 3.8% in April.
Economists highlighted that the details of the report were even worse than the weak headline number.
“Some of the other details were even worse. Core capital goods orders fell by 0.9%, while the prior month was revised down substantially (now 0.3% vs. 1.4% prior). While the three-month trend is still in positive territory, we will need to see better numbers ahead for it to stay that way. Today's data reinforces our forecast for a deceleration in business investment in Q2 and could weigh on the USD today,” said CIBC Capital Markets economist Katherine Judge.