(Kitco News) - The gold market is trading lower ahead of the weekend after the latest data showed consumer optimism improved and one-year inflation expectations ticked lower.
The University of Michigan said Friday that its preliminary Consumer Sentiment survey rose to 73 in November, the highest reading in seven months and up from October’s final reading of 70.5. The data was better than expected, as economists had anticipated a smaller rise to 71.
Gold is seeing some selling pressure following the economic data release. Spot gold last traded at $2,684.31 per ounce, and is down 0.83% on the day but still above the session low of $2,680.41.
The components of the index were largely improved. “While current conditions were little changed, the expectations index surged across all dimensions, reaching its highest reading since July 2021,” said Surveys of Consumers Director Joanne Hsu. “Expectations over personal finances climbed 6% in part due to strengthening income prospects, and short-run business conditions soared 9% in November. Long-run business conditions increased to its most favorable reading in nearly four years.”
“Sentiment is now nearly 50% above its June 2022 trough but remains below pre-pandemic readings,” she added, noting that interviews for the survey concluded on Monday and did not capture any reaction to the election results.
“Year-ahead inflation expectations fell slightly from 2.7% last month to 2.6% this month,” Hsu wrote. “The current reading is the lowest since December 2020 and sits within the 2.3-3.0% range seen in the two years prior to the pandemic. Long-run inflation expectations inched up from 3.0% last month to 3.1% this month, remaining modestly elevated relative to the range of readings seen in the two years pre-pandemic.”
