Gold price battles $1,900 as U.S. service sector disappoints in October
(Kitco News) Gold edged up slightly as momentum in the service sector disappointed in October, according to the latest data from the Institute of Supply Management (ISM).
The Non-Manufacturing Purchasing Managers Index was at a reading of 56.6% in October, down from September’s 57.8%. The 1.2 percentage-point decrease surprised the markets, with consensus expectations calling for the index to come in at 57.5%.
Readings above 50 are seen as a sign of economic growth – the farther an indicator is above or below 50, the greater or smaller the rate of change.
"This reading represents a fifth straight month of growth for the services sector, which has expanded for all but two of the last 129 months," the report said.
The details of the ISM Non-Manufacturing report revealed that the new orders sub-index was at 58.8% following September’s 61.5%.
Looking at other components, business activity sub-index was at 61.2% following 63% registered in September. The employment index was at 50.1% versus September’s 51.8%. Economists keep a close eye on the latter number as a gauge into the employment situation in the country.
Inflation pressures rose, with the price index coming in at 63.9% in October after September’s reading of 59%.
In an immediate reaction to the latest ISM Non-Manufacturing index, gold prices edged up and rose back above the $1,900 an ounce level. December Comex gold futures were last trading at $1,905.90, down 0.24% on the day.