(Kitco News) – After a solid gap higher at the start of the new trading week, gold is holding near its session highs as the Federal Reserve Bank of New York reported slowing activity in its manufacturing region, along with rising input prices.
The regional central bank reported Monday that its Empire State Manufacturing Survey rose less than expected, posting a reading of 5.7 in June, down sharply from May’s four-year high of 19.6.
The data significantly missed consensus estimates, with economists forecasting a reading of 13.2.
“Following strong growth in May, manufacturing activity in New York State increased modestly in June. Employment grew for the fifth straight month, but price increases remained elevated and supply availability worsened,” said Richard Deitz, Economic Research Advisor for the central bank.
The gold market is not seeing any major reaction to the disappointing manufacturing data, as traders continue to focus on news that the U.S. and Iran have agreed to a peace deal. However, some analysts have said that weak economic data, coupled with stubborn inflation pressures, should provide support for gold as a hedge against rising stagflationary risks.
Spot gold last traded at $4,344.30 an ounce, up nearly 3% on the day.
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