(Kitco News) - The gold market continues to test resistance just below $2,050 an ounce but is struggling to attract new bullish momentum even as U.S. economic data disappoints.
The Consumer Confidence Index dropped in February to 106.7, down from January’s downwardly revised reading of 110.90, the Conference Board said on Tuesday. Consumer optimism dropped more than expected as economists were forecasting an increase to 114.8.
“February’s decline in the Index occurred after three consecutive months of gains. However, as January was revised downward from the preliminary reading of 114.8, the data now suggest that there was not a material breakout to the upside in confidence at the start of 2024,” the report said.
The gold market is not seeing much reaction following weaker-than-expected economic data. April gold futures last traded at $2,043.10 an ounce, up 0.21% on the day.
The report noted a broad-based decline in consumer optimism as both current sentiment and expectations dropped in February. The Present Situation Index fell to 147.20, down from 154.9 in January. At the same time, the Expectations Index declined to 79.80, down from 81.50.
“An Expectations Index reading below 80 often signals recession ahead,” the report said.
Dana Peterson, Chief Economist at The Conference Board, said that the drop in confidence was felt among all income groups except households earning less than $15,000 and those earning more than $125,000.
“February’s write-in responses revealed that while overall inflation remained the main preoccupation of consumers, they are now a bit less concerned about food and gas prices, which have eased in recent months,” said Peterson. “But they are more concerned about the labor market situation and the U.S. political environment.”
