Gold Price Drops as U.S. Manufacturing Shrinks at Slower Pace
The gold price skidded on Tuesday, erasing earlier gains, after data showed that U.S. manufacturing conditions improved last month.
Gold for April delivery fell 0.2% to $1,232.80 an ounce at 12:02 p.m. on the Comex division of the New York Mercantile Exchange. The contract had advanced to as high as $1,249 earlier in the session, compared to Monday’s closing of $1,238.
An industry report showed on Tuesday that the U.S. manufacturing sector contracted for a fifth straight month in February but at a slower pace than January.
The Institute for Supply Management (ISM) index increased to 49.5% in February, about one point above forecast and surpassing January’s 48.2 print. A reading above 50 points to expansion in the manufacturing sector and a reading below 50 points to contraction.
One more report helped nudge down the gold price on Tuesday. The Commerce Department reported that construction spending rose a better-than-expected 1.5% in January.
U.S. stocks, on the other hand, are benefiting from Tuesday’s data, heading to halt two sessions of losses. The Dow Jones Industrial Average (DJIA) is up 1.4%, the S&P 500 rallied 1.8%, and the NASDAQ composite leaped 2.2%.
Also on the Comex on Tuesday, May Silver fell 0.8% to $14.79. Bucking the trend, April platinum rose 0.3% to $937.60, and palladium jumped 4.6% to $518.65.
Since the beginning of the year, gold has surged 16.0%; silver, 7.0%; platinum, 4.9%, while palladium is in negative territory with a 8.3% loss.
