Gold Softer As U.S. Consumer Confidence Index Rises To 17-Year High
Editor's Note: Updating earlier story to include more details from report, comment from economist, current prices.
(Kitco News) - Gold fell Tuesday after The Conference Board reported that its index for U.S. consumer confidence rose to 125.9 in October, its highest level in 17 years.
The index reading is up from a revised 120.6 in September. Consensus expectations from most news organizations called for a reading of around 121.
“Consumers’ confidence isn't showing any signs of cooling off,” said Royce Mendes of the CIBC economics department.
In particular, he pointed to the part of the report in which respondents said that jobs were more plentiful than the prior month.
“That being said, the high level of confidence might not be fully reflected in hard data on spending,” Mendes said. “Purchasing intentions for both homes and major appliances declined in October. And while plans to purchase autos were higher, that's likely being buoyed by the need to replace some vehicles that were damaged by hurricanes, something that is both transitory and has already been reflected in retail sales.
“Overall, the high level of confidence is encouraging, but not something that will materially change most tracking forecasts.”
Lynn Franco, director of economic indicators at The Conference Board, commented that consumers’ assessment of current conditions improved, “boosted by the job market which had not received such favorable ratings since the summer of 2001.”
According to the report, the percentage of consumers stating jobs are “plentiful” increased from 32.7% to 36.3%, while those claiming jobs are “hard to get” decreased slightly from 18% to 17.5%.