U.S. manufacturing PMI beats expectations, gold price retreats
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(Kitco News) Gold edged down after the preliminary manufacturing and service-sector sentiment data were released for March.
The flash U.S. manufacturing Purchasing Managers (PMI) Index for March advanced to 49.3, marking a five-month high, according to the report. The March number beat the market’s expectations of a reading of 47.0.
The service sector saw the PMI reading jump to 53.8 in March, marking an 11-month high.
Any monthly reading above 50 points to an expanding sector, while anything below that shows a contraction in activity.
“At 49.3, the S&P Global Flash U.S. Manufacturing PMI … signaled a slight deterioration in operating conditions across the manufacturing sector. The rate of decline in the health of the sector was the slowest in the current five-month sequence of deterioration,” the report said. “The U.S. Services Business Activity Index posted 53.8 in March … to signal a solid expansion in service sector business activity. The rise in output was the fastest since April 2022, with firms linking the upturn to stronger demand conditions and a renewed increase in new business.”
March is seeing a resurgence of economic growth, but renewed activity is uneven, said Chris Williamson, chief business economist at S&P Global Market Intelligence.
“Although manufacturing eked out a small production gain, this was mainly a reflection of improved supply chains allowing firms to fulfill backlogs of orders that had accumulated during the post-pandemic demand surge. Tellingly, new orders have now fallen for six straight months in manufacturing. Unless demand improves, there seems little scope for production growth to be sustained at current levels,” Williamson pointed out.
Following the PMI data release, gold retreated, with April Comex gold futures last trading at $1,993, down 0.15% on the day.