Gold prices fall following strong rise in October durable goods data
(Kitco News) - Gold prices remain under pressure falling slightly but still holding critical support above $1,450 an ounce as momentum in the U.S. manufacturing sector rose significantly last month.
Wednesday, a U.S. Commerce Department report showed U.S. durable-goods orders increased by 0.6% in October, up from September’s revised 1.4% drop. The headline data was better than expected as economists were expecting a drop of 0.5%.
Stripping out the volatile transportation sector, core durable goods orders increased 0.6% last month. Economists were expecting to see an increase of 0.2%.
The gold market is seeing some modest selling pressure following the better-than-expected manufacturing data. February gold futures last traded at $1,461.12 an ounce, down 0.42% on the day.
According to some economists, the latest manufacturing data does not bode well for gold prices as it could further ease some of the recession fears in the marketplace. Avery Shenfeld, senior economist at CIBC said that the report showed that the U.S. manufacturing sector has been resilient in the face of global growth headwinds.
Shenfeld said that the data should push U.S. bond yields higher today, which would be negative for gold.