(Kitco News) - Gold prices are back in positive territory after sentiment dropped in both the U.S. manufacturing and service sectors.

The flash U.S. manufacturing Purchasing Managers Index for April declined to a reading of 52.7 unchanged from March’s reading, research firm IHS Markit said in its report released on Thursday. The latest monthly figure came short of economists’ expectations for a reading of 52.8.

At the same time, the firm’s service sector PMI reading fell to 52.9 from March’s reading of 55.3. Economists were projecting for the index to edge up to 55. The reported noted that sentiment within the manufacturing sector is near its lowest level in more than 2 years.

The data still showed expanding growth in both sectors albeit at a slower pace than expected. Any monthly reading above 50 points to an expanding sector, while anything below that shows contraction in activity.

Gold prices have reacted positive to the disappointing data, reversing losses made earlier in the session. June futures last traded at $1,278.20, up 0.11% on the day.

“The US economy started the second quarter with its weakest expansion since mid-2016 as businesses reported a marked slowing in output, new orders and hiring,” said Chris Williamson, chief business economist at IHS Markit. “The survey indicates that the manufacturing downturn seen in the first quarter has persisted into April, but growth in the service sector has now also slumped to a two-year low as the malaise showed further signs of spreading beyond the factory sector.”

Williamson added that the data points to slower growth for through the rest of the year as expectations are at their lowest level since 2012.