(Kitco News) - The gold market has soared through its latest milestone at $5,000 an ounce, but could face renewed headwinds as the U.S. manufacturing sector shows robust activity.
The Commerce Department announced Monday that U.S. durable goods orders rose 5.3% in November, following October’s 2.1% drop. The data was better than expected, as the consensus view among economists called for an increase of 3.1%.
Core durable goods, which strip out the volatile transportation sector, rose 0.5% in November, above the consensus forecast of 0.3% and higher than October’s 0.1% increase.
At the same time, non-defense capital goods ex-air increased 0.7% in November, also beating expectations. According to consensus forecasts, economists were looking for a 0.3% increase.
“The ex-air component has been positive for a fifth consecutive month, underscoring the better demand environment,” said Giuseppe Dellamotta, Market Analyst at Forexlive.com
The gold market has seen some slight selling pressure in its initial reaction to the better-than-expected manufacturing data; however, prices continue to hold solid gains above $5,000 an ounce. Spot gold last traded at $5,062.30 an ounce, up 1.6% on the day.
Some analysts have said that although gold continues to show strong bullish momentum, it could face some pressure as the latest economic data further supports the Federal Reserve’s current path to keep interest rates unchanged through the first half of the year.
