Gold price recovers after a slight pullback as ISM Manufacturing Index surprises on the upside
(Kitco News) Gold recovered its daily losses after hitting a new all-time high early on Monday as the headline manufacturing index from the Institute for Supply Management rose more than expected in July.
The ISM manufacturing index came in at 54.2% last month, beating market expectations of 53.6%. July’s monthly increase marked a 1.6-percentage-point advance from June’s reading of 52.6%.
Readings above 50% in such diffusion indexes are seen as a sign of economic growth, and vice-versa. The farther an indicator is above or below 50%, the greater or smaller the rate of change.
Following the release, gold prices began to climb again after seeing some profit-taking following new all-time highs. The December Comex gold futures were last trading at $1,986.80, up 0.05% on the day.
The employment index was at 44.3% in July, up from 42.1% in the prior month. The prices index rose to 53.2% following June’s reading of 51.3%.
The index for new orders jumped to 61.5%, while the production index was up 62.1%.
“The growth cycle continues for the second straight month after three prior months of COVID-19 disruptions. Demand and consumption continued to drive expansion growth, with inputs remaining at parity with supply and demand. Among the six biggest industry sectors, Food, Beverage & Tobacco Products remains the best-performing industry sector, with Chemical Products, Computer & Electronic Products and Petroleum & Coal Products growing respectably. Transportation Equipment and Fabricated Metal Products continue to contract, but at soft levels,” said Timothy Fiore, chair of the ISM Manufacturing Business Survey Committee.