The Institute for Supply Management (ISM) Manufacturing Purchasing Managers’ Index (PMI) is a key indicator of the economic health of the U.S. manufacturing sector. A PMI reading below 50 signifies contraction, while above 50 indicates expansion.
Today’s given signal : https://t.me/calendarsignal/17267
Reasons for the Release of Bad US ISM Manufacturing Data:
- Weak Demand: Persistent weak demand has led to reduced new orders and production levels, contributing to the manufacturing sector’s contraction.
- High Interest Rates: Elevated borrowing costs have dampened business investments and consumer spending, negatively impacting manufacturing activities.
- Global Economic Slowdown: Sluggish global economic growth has reduced export opportunities for U.S. manufacturers, further straining the sector.
Impact on XAU/USD (Gold Prices):
Gold is often considered a safe-haven asset, attracting investors during economic downturns or periods of uncertainty. A contraction in the manufacturing sector can signal broader economic challenges, influencing gold prices.
Specific Example:
In July 2024, the ISM Manufacturing PMI declined to 46.8, indicating a significant contraction. This downturn led to increased investor concerns about economic stability, prompting a shift towards safe-haven assets like gold. Consequently, the XAU/USD pair experienced an uptick during this period.
Previous released data results :
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