(Kitco News) – Technical buying momentum is helping the gold market stand up to stronger-than-expected economic data as the Philadelphia Federal Reserve reported a pick up in manufacturing activity for August.
Wednesday, regional central bank said its manufacturing business outlook rose to 6.2 in August, up solidly from July’s -12.3 reading. The data significantly beat expectations as consensus forecasts called for a negative reading around 5.
The gold market is largely ignoring the latest economic data. December gold futures last traded at $1,783 an ounce, up 0.35% on the day.
The latest report from the Philly Fed provides a stark contrast to the New York Federal Reserve’s manufacturing data, which dropped to -31.3.
Despite the positive headline reading, the central bank noted that there are still risks to the manufacturing sector.
“Although the general activity index turned positive, it was low, and the new orders index remained negative,” the report said.
The report said that the new orders index rose to -5.1, up from July’s reading of -24.8. At the same time, shipments rose to 24.8, up from the previous reading 14.8.
The report also noted new momentum in the region’s labor market. The number of employees index rose to 24.1, up from July’s reading of 19.4.
The report also highlighted falling inflation pressures, another negative for the gold market. The prices paid index dropped to 43.6, down from July’s reading of 52.2.
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