Gold price near daily highs as ISM Manufacturing Index disappoints in June
(Kitco News) Gold remained near its daily highs as the headline manufacturing index from the Institute for Supply Management came in below expectations in June.
The ISM manufacturing index was at 60.% last month, disappointing markets' consensus estimates of 61%. The monthly figure marked a 0.6 percentage-point decline from May's reading of 61.2%.
"This figure indicates expansion in the overall economy for the 13th month in a row after a contraction in April 2020," the report said.
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 were largely unchanged. August Comex gold futures were last trading at $1,778.80, up 0.41% on the day.
The employment index retreated to 49.9% in June, down from May's reading of 50.9%. The index for new orders decreased to 66% from 67%, while the production index advanced to 60.8% from 58.5%.
The report noted that companies continue to struggle to meet rising demand.
"Record-long raw-material lead times, wide-scale shortages of critical basic materials, rising commodities prices and difficulties in transporting products are continuing to affect all segments of the manufacturing economy," the report said." Worker absenteeism, short-term shutdowns due to parts shortages, and difficulties in filling open positions continue to be issues that limit manufacturing-growth potential."
Overall, June's growth was described as "moderate to strong," with all of the six biggest manufacturing industries, including computer and electronic; chemicals; fabricated metal products; transportation equipment; food, beverage and tobacco; and petroleum and coal products seeing increases.