(Kitco News) - Gold prices shot to session highs after manufacturing activity in the New York region rose deeper into expansionary territory this month, according to the latest data published by the New York Federal Reserve.
The regional central bank announced on Wednesday that its Empire State manufacturing survey improved to 15.6 in July, after posting a 5.7 print in June. The data was far better than expectations, as consensus forecasts called for a slight rise to 6.2.
“New orders and shipments increased strongly,” the report said. “Unfilled orders increased, delivery times continued to lengthen, and supply availability continued to worsen. Employment rose at a solid clip and the average workweek edged higher. The pace of input and selling price increases remained elevated but slowed slightly. Firms remained fairly optimistic that conditions would improve in the months ahead.”
Gold prices shot to session highs in the moments after the 8:30 am EST release, which came out at the same time as June PPI. Spot gold last traded at $4,063.13 per ounce for a gain of 0.25% on the session.
The components of the report showed conditions improving on balance across the region’s manufacturing sector.
“The new orders index climbed nineteen points to 22.2, and the shipments index rose sixteen points to 24.4–a four-year high–pointing to marked increases in orders and shipments,” the report noted. “Unfilled orders and inventories rose slightly. The delivery times index edged up to 13.0, suggesting that delivery times continued to lengthen. The supply availability index remained negative at -10.0, pointing to worsening supply availability.”
The employment picture also improved, while the prices indexes were mixed. “The index for number of employees rose two points to 11.4, its highest reading since December 2022, and the average workweek index came in at 2.8, suggesting an increase in both employment and hours worked for a sixth consecutive month,” they said. “The pace of price increases remained elevated, but the prices paid index declined nine points to 52.3, and the prices received index dipped four points to 27.6, suggesting that the pace of price increases slowed slightly after particularly sharp increases in May and June.”
Looking ahead, the New York Fed said that firms remained fairly optimistic about the outlook. “The index for future business conditions came in at 27.9, with half of respondents expecting activity to increase in the months ahead,” they noted. “New orders and shipments are expected to increase, and employment is expected to grow. Supply availability is expected to worsen somewhat, while price increases are expected to remain elevated. Capital spending plans remained modest.”
