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U.S. durable-goods beat expectations but gold holds $1,500

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Gold tries to hold $1,500 as U.S. durable-goods beat expectations

(Kitco News) - Gold prices were attempting to hold the $1,500 an ounce level after newly released data showed that orders for long-lasting U.S. factory goods were up 0.2% in August, coming in above expectations.

Market consensus was calling for a 1.1% decline. Meanwhile, July’s data was revised to 2%.

Following the data release, gold prices were largely unmoved as the metal tried to hold the $1,500 support level after selling off overnight. December Comex gold futures were last trading at $1,500.10, down 1% on the day. 

The monthly increase in durable-goods orders equaled to $500 million and was largely led by military-related items. 

The core durable goods section, which excludes volatile transportation sector, was up 0.5% in August. Excluding defense, new orders fell 0.6%.

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.

Even though spending on durable goods represents a small part of American economic output, economists carefully watch for any changes as a sign of where the economy might be heading.

After digesting the report, analysts pointed to core capital goods orders, which is a closely watched gage on business spending that was down 0.2% in August, and said that it could signal weakness in business investment.

“Durables orders were much better than expected ... Still, core capital goods orders fell 0.2%, but that still leaves them up 2.6% annualized in the last three months due to a big gain back in June … Overall, a win-some, lose-some set of data today,” said CIBC Capital Markets chief economist Avery Shenfeld.

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