Today, the U.S. Manufacturing ISM report was published; according to the recent report, the U.S. Manufacturing PMI index declined to 49.5% during November 2012. The U.S. Manufacturing PMI is an index estimating the economic development of the U.S. manufacturing sectors; this means the manufacturing sector has shifted from growth to contraction compared to the previous month; the index fell from 51.7% in October to 49.5% in November i.e. a 2.2 percent point drop. This means that the U.S. manufacturing sector has contracted after it had expanded in the previous couple of months.
Among the sectors that were analyzed in this survey: new orders, production, employment and exports. The production increased again by 1.3 pp to 53.7 – the production has expanded at a faster pace. New orders are still growing but at a slower pace as its index fell by 3.9pp to 50.3. Some items, much like the PMI, have contracted during last month including: employment, backlog of orders, exports and imports. Further some of these items are not only contracting but they are also contracting faster in November than they did in October.
The PMI Manufacturing ISM report tends to be negatively linked with the changes of gold and silver prices (Roache et. al (2008)) without controlling to the U.S dollar effect. Furthermore, the change in PMI index suppose to positively affect natural gas prices, i.e. all things being equal, including the U.S dollar, as the PMI Manufacturing ISM index falls, natural gas prices also tend to decline.
Current gold price, (short term 2012 delivery) is traded at $ 1,717.7 per t oz. a $5 increase or 0.29%, as of 17:08*.
Current Nymex crude oil price, (short term 2012 delivery) is traded up by 0.25%, at $89.13 per barrel as of 17:08*.
Euros to USD is currently traded at 1.3067 as of 17:08*.
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