You are currently viewing Gold price holding gains above critical support as U.S. ISM Service-sector PMI falls to 56.5% – Kitco NEWS

Gold price holding gains above critical support as U.S. ISM Service-sector PMI falls to 56.5% – Kitco NEWS

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(Kitco News) – The gold market is holding on to solid gains but seeing little reaction to weaker-than-expected momentum in the U.S. service sector, according to the latest data from the Institute for Supply Management (ISM).
Thursday, the ISM said its service sector PMI fell to a reading of 56.5% in February down from January’s reading of 59.9%. Consensus forecasts were calling for a 61.2% reading.
Readings above 50% in such diffusion indexes are seen as a sign of economic growth and vice-versa. The farther an indicator is above or below 50%, the greater or smaller the rate of change.
"Respondents continue to be impacted by supply chain disruptions, capacity constraints, inflation, logistical challenges and labor shortages. These conditions have affected the ability of panelists’ businesses to meet demand, leading to a cooling in business activity and economic growth," said Anthony Nieves, chair of the ISM Services Business Survey Committee.
The gold market, continues to see strong safe-haven demand as Russia’s invasion of Ukriane hits the one-week mark. The precious metal is seeing little rection to economic data. April gold futures last traded at $1,931 an ounce, up 0.45% on the day.
The components of the report showed broad-based declines in momentum. The report said that the business activity index showed a reading of 55.1%, down from January’s reading of 59.9.
At the same time, the new orders index dropped to a reading of 56.1%, down from the previous reading of 61.7%.
The report also noted falling momentum in the labor market. The employee index fell to a reading of 48.5%, down from January’s reading of 52.3%.
Positive for gold, the report also noted rising inflation pressure. The prices index rose to 83.1%, up from January’s reading of 82.3%.
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