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Gold extends early gains to trade sharply up on the day

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Live 24 hours gold chart [Kitco Inc.]

(Kitco News) - Gold prices are trading over $20 an ounce higher in late-morning price action Tuesday, following some downbeat U.S. economic data. The U.S. ISM August manufacturing purchasing managers index (PMI) came in at 49.1 versus 51.2 in July. A reading below 50.0 suggests contraction in the sector. Also, July U.S. construction spending came in at up a paltry 0.1% from June, which was also a miss to the downside. These reports fall into the camp of the monetary policy doves, who want to see the Federal Reserve lower interest rates. Geopolitical concerns already had gold trading with double-digit gains, before the U.S. data was released. December gold was last up $23.10 at $1,552.40.

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