Gold prices hold above $2,000 an ounce as U.S. consumer confidence falls less than expected to 102.6
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(Kitco News) -The gold market continues to trade near session highs above $2,000 an ounce, even as U.S. consumers remain slightly more optimistic.
The Conference Board said on Tuesday its consumer confidence index fell to 102.6. this month, compared to September's revised reading of 104.30. However, the data was slightly better than expected, as consensus estimates looked for a decline to 100.5.
The gold market continues to ignore solid economic data as safe-haven demand, due to geopolitical instability, drives momentum in the marketplace. December gold futures last traded at $2,009.70 an ounce, up 0.20% on the day.
The components of the report decline in near-term and medium-term outlooks. The Present Situation Index dropped to 143.1, down from September's reading of 146.2; at the same time, the Expectations Index dropped to 75.6, down from the previous reading of 76.4.
The report noted that weak consumer sentiment continues to highlight recession fears.
"The Expectations index is still below 80—the level that historically signals a recession within the next year. Consumer fears of an impending recession remain elevated, consistent with the short and shallow economic contraction we anticipate for the first half of 2024," the report said.
Dana Peterson, Chief Economist at The Conference Board, noted that this was the third consecutive decline in sentiment, even as it beat expectations. She said the survey shows consumers remain concerned about inflation and the growing turmoil in the Middle East.
"Write-in responses showed that consumers continued to be preoccupied with rising prices in general, and for grocery and gasoline prices in particular. Consumers also expressed concerns about the political situation and higher interest rates," she said. "Worries around war/conflicts also rose amid the recent turmoil in the Middle East. The decline in consumer confidence was evident across householders aged 35 and up, and not limited to any one income group."