Gold Prices Mixed After Upbeat Factory Data
Gold prices traded mixed on Monday as upbeat Eurozone, Chinese and U.K. manufacturing data helped ease fears about global economic recovery.
The downside, if any, remained capped amid worries over a further tightening of restrictions in Europe and a deadlock in the deliberations over a new stimulus deal in the U.S.
Spot gold dropped 0.4 percent to $1,968.53 per ounce after touching a record high of $1,985.11 per ounce earlier in the day. U.S. gold futures were marginally higher at $1,974.70 per ounce.
A private survey showed China’s factory activity expanded at the fastest pace in nearly a decade in July, helping ease worries about the Covid-19 pandemic on the global economy.
The euro area manufacturing sector returned to growth in July for the first time in a year-and-a-half as output and demand continued to recover with the further easing of restrictions related to the coronavirus disease, final data from IHS Markit showed.
The manufacturing Purchasing Managers’ Index rose to 51.8 in July from 47.4 in June. This was also above the flash reading of 51.1.
U.K. manufacturing activity is also on course for recovery as the nation’s lockdown eased and furloughed staff returned to work.
The IHS Markit/CIPS manufacturing purchasing managers’ index (PMI) rose to 53.3 last month from 50.1 in June.
On the coronavirus front, more countries imposed new restrictions or extended the current ones as coronavirus cases continued to surge in the United States and stood at almost 18 million globally.
As the United States enters a new phase of the pandemic, a senior Federal Reserve official on Sunday urged Congress to act to spend big on coronavirus relief efforts and suggested a fresh lockdown.
The U.S. Senate is due to go into recess on 7 August, leaving little time for Republicans and Democrats to reach agreement on the latest stimulus package.
White House Chief of Staff Mark Meadows warned Sunday he was not optimistic on reaching agreement soon on the stimulus deal.