Institute for Supply Management (ISM) data released on Monday showed that the US manufacturing sector contracted for the sixth month in a row, causing the gold market to drop below $2,000 an ounce.

The ISM Manufacturing Index for April was at 47.1%, which was slightly better than the expected 46.8%.

This number was also higher than March’s 46.3% by 0.8 percentage points. Readings above 50% indicate economic growth, while readings below 50% indicate contraction. Despite some improvements in the employment and prices indexes, the index for new orders remained in the contraction zone.

Following the release, gold prices fell, with June Comex gold futures last trading at $1,996.70, down 0.12% on the day.

The gold market reversed gains and fell below $2,000 an ounce after data showed the US manufacturing sector contracted for the sixth consecutive month in April. This indicates that investors are reacting to the weak economic data, which is driving them towards other assets and reducing their demand for gold.

The Institute for Supply Management (ISM) manufacturing index, which is a key indicator of the US manufacturing sector, was at 47.1% in April. Although this was slightly better than the expected 46.8%, it still indicates that the manufacturing sector is contracting.

Gold is generally viewed as a safe haven asset and tends to rise during times of economic uncertainty. However, in this case, weak economic data is causing investors to reduce their demand for gold, which is leading to a drop in prices.

Going forward, the impact of economic data on gold prices will depend on several factors, such as the severity and duration of the economic contraction, the extent of government intervention and stimulus measures, and the response of central banks.

If the US manufacturing sector continues to contract and other economic data remains weak, we could see further downward pressure on gold prices. However, if there is a strong economic recovery or significant government intervention, we could see an increase in demand for gold and upward pressure on prices.

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