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U.S. manufacturing PMI beats expectations, gold price retreats

Kitco Media
By Anna Golubova
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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.

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Anna Golubova

Anna Golubova is the Producer for Kitco News. With more than ten years of experience in media, she has covered a range of topics, focusing on economy and politics. Anna began to exclusively cover economic news in 2013, attending media lockups at the Bank of Canada and Statistics Canada to report on a range of key macro economic events, including interest rate announcements, GDP, unemployment, and retail. She holds a Master of Arts in International Relations from NPSIA, Carleton and a Bachelor's degree in Political Science and History from the University of Ottawa.

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