Gold moderately rises in price on weak stats from China

Gold prices showed a moderate increase during trading on July 5 due to increased demand for defensive assets caused by weak statistical data on the Chinese economy, Report informs referring to Interfax.

Quotations of August contracts for gold on the New York Comex exchange increased by 0.34% to $1,936 per troy ounce.

The Composite Purchasing Managers’ Index (PMI) in China, calculated by Caixin Media Co. and S&P Global fell to 52.5 in June from 55.6 in May. Services PMI fell to 53.9 from 57.1.

Both indicators hit new five-month lows amid a slower-than-expected recovery in China’s economy after the lifting of quarantine restrictions. Meanwhile, a PMI index above 50 points indicates an increase in business activity, and both indexes have remained above this mark for six months in a row.

“Fragile market confidence and a dip in equities on the back of concerns about the health of the global economy has seen investors keen to keep hold of their safe haven gold assets,” said Rupert Rowling, market analyst at Kinesis Money, in emailed commentary shared with MarketWatch. Therefore, investors are afraid that the aggressive policy of the central banks will plunge the economy into recession.