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(Kitco News) - The gold market is struggling to maintain a handhold on $2,000 an ounce and is seeing little safe-haven demand even as U.S. consumer confidence falls more than expected.
American consumer confidence index fell to 101.3 in April, down from March's reading of 104, the U.S. Conference Board reported Tuesday. According to consensus estimates, economists were looking for a roughly unchanged reading.
The gold market is not seeing much reaction to the latest economic data as it trades around a critical psychological level. June gold futures last traded at $1,999.20 an ounce, roughly unchanged on the day.
According to the report, consumers remain optimistic that near-term conditions will remain strong; however, there is growing pessimism that conditions will deteriorate. The Present Situation Index rose to 151.1, up from March's reading of 148.9; meanwhile, the Expectations Index dropped to 68.1, down from 74.
"The Expectations Index has now remained below 80—the level associated with a recession within the next year—every month since February 2022, with the exception of a brief uptick in December 2022. The survey was fielded from April 3—about three weeks after the bank failures in the United States—to April 19," the report said.
Ataman Ozyildirim, senior director of economics at The Conference Board, said that along with rising recession fears, consumers also see inflation holding at elevated levels.
"April's results show consumer inflation expectations over the next 12 months remain essentially unchanged from March at 6.2 percent—although that level is down substantially from the peak of 7.9 percent reached last year, it is still elevated," said Ozyildirim. "Overall purchasing plans for homes, autos, appliances, and vacations all pulled back in April, a signal that consumers may be economizing amid growing pessimism."
