(Kitco News) - Gold prices were coming off their earlier session highs after manufacturing activity in the New York region rose further into expansionary territory this month, according to the latest data published by the New York Federal Reserve.
The regional central bank announced on Monday that its Empire State manufacturing survey improved to 20.6 in August, its highest reading in over four years, after posting a 15.6 print in July. The data was better than expectations, as consensus forecasts called for a decline to 10.2.
“New orders and shipments posted solid gains,” the report said. “Unfilled orders increased notably, delivery times lengthened substantially, and inventories declined. Supply availability continued to worsen. Employment levels and the average workweek rose modestly. The pace of input price increases picked up, and selling price increases remained elevated but eased for a second consecutive month. Looking ahead, firms maintained an optimistic outlook for business activity.”
Gold prices were giving back some of their earlier gains in the minutes after the 8:30 am ET release. Spot gold last traded at $4,379.42 per ounce for a gain of 0.06% on the session.
The components of the report showed conditions improving on balance across the region’s manufacturing sector.
“The new orders index came in at 17.3, and the shipments index printed at 11.7, pointing to continued solid increases in orders and shipments,” the report said. “The unfilled orders index rose eleven points to 15.5 and the delivery times index rose eight points to 20.6, suggesting an increase in unfilled orders and significantly longer delivery times. Inventories declined. The supply availability index dipped three points to -13.4, pointing to worsening supply availability.”
The employment picture also improved, while the prices indexes were mixed. “The index for number of employees came in at 9.3, and the average workweek index rose to 6.9, suggesting an ongoing expansion of employment levels and hours worked,” the report said. “The prices paid index rose six points to 58.6, pointing to a pickup in input price increases, and the prices received index dipped five points to 22.7, suggesting that selling price increases moderated but remained elevated.”
Looking ahead, the New York Fed said that firms remained fairly optimistic about the outlook. “The index for future business conditions rose four points to 32.1, suggesting firms remained optimistic about future conditions,” they wrote. “New orders and shipments are expected to increase significantly, and employment is expected to pick up strongly over the next six months. Supply availability is expected to worsen, and price increases are expected to remain elevated. Capital spending plans remained modest.”
