© Reuters.
Investing.com – The Institute for Supply Management’s manufacturing PMI data has now been released against market expectations, as this indicator is important in the outlook for the coming period, as it gives an overview of the performance of the economy in general and whether it is heading towards recession or not.
The data was negative this time, warning that the economy may enter a stage of recession in the coming period, which is what it wants to control inflation. Where gold interacted with the issuance of the data and has now exceeded the levels of $2,000 an ounce, while the dollar deepened its declines during these moments of today’s trading.
Manufacturing PMI
(ISM) recorded 46.3 points for the month of March, while it was expected to score 47.5 points, and the previous reading was at 47.7 points.
While (ISM) scored 49.2 points in March after it was destined to score 51.2 points, after it scored 51.3 points in February.
The Industrial Support Management (ISM) index determines the activity level of purchasing managers in the industrial sector. A reading above 50 indicates expansion, and vice versa if it is below 50 points.
To get a reading of this indicator, purchasing managers determine the level of certain elements in the sector, including employment, production, new orders, resource allocation, and inventories. The bullish trend a positive impact on the country’s currency.
Currency traders closely monitor this index, as purchasing managers, due to the nature of their work, can access data about their companies’ performance, which makes this index a leading indicator of general economic performance.
Federal Reserve statement a while ago
A member of the US Federal Reserve, James Bullard, said: “The US response to the banking crisis was quick and appropriate, and that the Fed can continue its tightening monetary policy to curb inflation.”
And when asked about the OPEC move and its impact on inflation, Pollard said that it is an open question and the OPEC move will have an impact in the long run.
Bullard confirmed that the Fed needs to raise interest rates above 5% levels, and that his personal expectations are higher than the average announced inflation of 5.1%.
Bullard expected inflation to be more entrenched and stubborn in the strong labor market sector, noting that the market has not yet been truly affected by the tightening policy. Adding, that the strength of the US labor market gives the Fed comfort to face high inflation.
Gold and the dollar now
The US dollar rose during the current moments, at levels near 1984 dollars an ounce, up by 0.7%.
On the other hand, futures contracts for the yellow metal rose during these moments of today’s trading, equivalent to 0.8%, up to levels near $ 2001 an ounce.
While the American deepened its losses in the current moments, and the dollar index now records from the 101.8 levels, losing approximately 0.4%.
