Gold edges up from daily lows as U.S. consumer confidence misses expectations in October
(Kitco News) Gold prices ticked up from daily lows after a reading of October’s U.S. consumer confidence index came in below expectations.
American consumer confidence index dropped to 125.9 in October, from September’s upwardly revised reading of 126.3, the U.S. Conference Board reported Tuesday. Economists were expecting to see the index increase, with the market consensus projecting a reading of 128.0.
Immediately after the release, December Comex gold futures edged up, last trading at $1,489.80, down 0.40% on the day. Earlier in the session, prices touched the daily lows of $1,486.50 an ounce.
The Present Situation Index, which describes consumers’ views on current business and labor market conditions, increased to 172.3 from 170.6. Meanwhile, the Expectations Index, which represents consumers’ short-term outlook on income, business, and labor market, declined to 94.9 from 96.8.
American consumers were worried about their job prospects and business conditions in October, said Lynn Franco, director of Economic Indicators at The Conference Board.
“Consumer confidence was relatively flat in October, following a decrease in September,” said Franco. “The Present Situation Index improved, but Expectations weakened slightly as consumers expressed some concerns about business conditions and job prospects. However, confidence levels remain high and there are no indications that consumers will curtail their holiday spending.”
Looking at the labor market, the report noted that the outlook on jobs was “less upbeat,” as the number of consumers expecting more jobs in the months ahead declined to 16.9% from 17.6%.
Traders closely watch the consumer optimism survey as it is a potential leading indicator for economic growth. The more optimistic consumers feel, the more likely they are going to spend money and vice versa.