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Gold price weighed down by resilient strength in Philly Fed Survey

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(Kitco News) - Better than expected data from the Philadelphia Federal Reserve showing resilient optimisms in the manufacturing sector is helping to keep pressure on gold prices.

Thursday, the regional central bank said its manufacturing business outlook fell to a reading of 26.3 in November, down from October’s reading of 32.2; however, the data significantly beat expectations as consensus forecasts were calling for a reading around 22.

"The survey’s current indicators for general activity, new orders, and shipments remained positive for the sixth consecutive month but fell from their readings in October," the report said. "The survey’s future indexes also moderated this month but suggest that growth is expected to continue over the next six months."

Shifting investor sentiment in the marketplace is weighing on gold prices and the latest economic data is not providing much relief. December gold futures are testing critical support levels, last trading at $1,852, down more than 1% on the day.

Looking at some of the components of the report, the new orders index dropped to a reading of 37.9, down from October’s level of 42.6; meanwhile, the shipments index dropped to a reading of 24.9, down from the previous level of 46.5.

It wasn’t all bad news in the report. The survey showed strong growth in the labor market. The number of employees index rose to 27.2, up from October’s reading of 12.7.

A positive for the gold market, inflation pressures are also on the rise. The report said that the prices paid index rose to 38.9, up from October’s reading of 28.5.

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