[ad_1]
Editor’s Note: With such market volatility, stay up to date with daily news! Take a minute to read our quick summary of today’s must-see news and expert advice. Register here!
Editor’s Note: The article has been updated to reflect a further decline in gold prices following the latest PMI data.
(Kitco News) – A multi-year rise in sentiment in manufacturing and services pushes gold down as prices drop below critical support. December gold futures traded near session lows of $ 1,841.40 an ounce, down 1.6% on the day.
Gold prices remain under pressure and struggle to attract new bullish momentum as sentiment in manufacturing and services reaches multi-year highs.
On Monday, IHS Markit said its flash manufacturing purchasing managers index in the United States for November rose to 65.7, from 53.4 in October. The data was significantly better than expected. Economists expected to see a reading of 52.5.
The report says sentiment in the manufacturing sector is at its highest level in 74 months.
At the same time, the business services sector PMI reading rose to 57.7, from 56.9 in October. Economists expected the index to enter 55.8.
Sentiment in the non-manufacturing sector is at its highest level in 68 months, according to the report.
Any monthly reading above 50 indicates an expanding industry, while anything below it shows a contraction in activity.
Gold prices were under pressure before PMI data and saw strong selling pressure in response. The market has moved below initial resistance at $ 1,850 an ounce and is trading just off session lows. December gold futures last traded at $ 1,834.50 an ounce, down 2% on the day.
At first glance, the latest economic data is negative for gold, but it highlights growing fears among analysts that inflation could accelerate faster than expected. Many analysts remain bullish on gold as an important hedge against inflation.
Chris Williamson, chief business economist at IHS Markit, said the rise in sentiment came at a price.
“First of all, the good news: business activity, both in industry and in services, increased in November at the highest rate since March 2015. The recovery reflected a further strengthening in demand, which encouraged companies to hire staff at a rate not seen since the survey began in 2009, ”he said in the report.
“However, soaring demand and hiring has pushed up prices and wages. Average selling prices of goods and services have risen at the fastest rate ever recorded by the survey, with supply shortages also more widespread than at any previously reported time, ”he added.
Warning: The opinions expressed in this article are those of the author and may not reflect those of Kitco Metals Inc. The author has made every effort to ensure the accuracy of the information provided; however, neither Kitco Metals Inc. nor the author can guarantee such accuracy. This article is for informational purposes only. This is not a solicitation to effect an exchange of commodities, securities or other financial instruments. Kitco Metals Inc. and the author of this article accept no responsibility for any loss and / or damage resulting from the use of this publication.
[ad_2]
Source link