For the 3rd time this week a keenly viewed US data release has come in worse than expected with the ISM non-manufacturing index falling to 53.9 from 54.7. This is a bigger drop than the consensus forecast which expected a decline to 54.5. However, a closer inspection of the sub-components reveals that the report overall wasn’t quite as bad as the headline appears.
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New orders: 57.1 vs 55.6 prior
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Prices paid: 58.5 vs 56.6 prior
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Employment 55.5 vs 53.7 prior
All of these can be seen as positive for the US dollar and after an initial knee-jerk reaction lower on the headline the buck is now moving back higher once more. This move has been replaicted in bonds with US yields pushing higher and Gold dropping to its lowest level of the day.
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It’s been an eventful afternoon for Gold with the precious metal jumping higher after the ADP miss and initially rising once the ISM data dropped. However, price has moved lower as traders digested the report which on the whole seems far better than it first seemed. Source; xStation
Our technical alert on Gold ahead of the data can be viewed here.
