Gold edged up as energy in the service sector was better-than-expected last month, this is coming from the latest information from the Institute of Supply Management.
The Non-Manufacturing Purchasing Managers Index hit 57.2% in December, better than November’s 55.9%. After the 1.3 increase, the consensus anticipation is for the index to level out at 54.6%.
Readings higher than 50 are viewed as a signal of economic growth – the further the metric is above or below the number 50, the bigger or lessor the rate of change.
“This data means a seven month stretch of growth for the services industry, which has grown for most of the last 131 months,” the document said.
The ISM Non-Manufacturing report revealed the new orders sub-index hit 58.5% after November’s 57.2%.
Analyzing other parts, the business activity sub-index reached 59.4% after being at 58.0% in November. While the employment index hit 48.2% as compared to November’s number of 51.5%. Economists keep close watch on the last metric as a measurement of the employment possibilities in the nation.
Inflation pressures showed up, with the price index hitting 64.8% in December compared to September’s reading of 66.1%.
And immediately the gold prices went up as shown by February Comex gold futures last trading number of $1,917.10, and increase of 0.45% on the day.
The increase in the service industry PMI was a shock, said economist Katherine Judge of CIBC Capital Markets.
“The increase showed a rise in commercial activity even though there were stricter covid measures during the holidays. With coronavirus seemingly spreading fast, it’s very possible the ISM’ s index could take a downturn in the coming months, until vaccines are a reality,” Judge said in a memo to his clients.