(Kitco News) - The gold market is trading at session highs after the latest data showed the U.S. manufacturing sector weakening last month.
The Institute for Supply Management (ISM) announced on Wednesday that its Manufacturing Purchasing Managers Index declined to 49.2 for April, compared to March’s reading of 50.3. The data was worse than expected, as consensus forecasts looked for a smaller decline to 50.0.
“The U.S. manufacturing sector dropped back into contraction after growing in March, the first time since September 2022 that the sector reported expansion,” said Timothy Fiore, Chair of the ISM Manufacturing Business Survey Committee. “Although demand improvement slowed, output remains positive and inputs stayed accommodative.”
Gold prices rallied to session highs following the release, with spot gold last trading at $2,306.91 per ounce, up 0.91% on the day.
The report showed broad-based weakness in its components. The New Orders Index declined to 49.1, down from the 51.4 reported in March. At the same time, the Production Index fell to 51.3, down from the previous month’s reading of 54.6.
The ISM did note improvement in the labor market even as it remained in contractionary territory. The Employment Index rose to 48.6, up from 47.4 the previous month.
However, the report also noted a sharp rise in inflation pressures. The Price Index spiked to 60.9, well above March’s reading of 55.8.
