(Kitco News) - Gold prices shot back into positive territory after the latest data showed U.S. consumer sentiment declining further than expected this month.
The Consumer Confidence Index fell to 94.2 in September, well below economists’ consensus forecast for a 96 reading and also below the upwardly revised 97.8 print from August, the Conference Board announced on Tuesday.
The Present Situation Index, based on consumers’ assessment of current business and labor market conditions, fell by 7.0 points to 125.4, the report noted. The Expectations Index, based on consumers’ short-term outlook for income, business, and labor market conditions, decreased by 1.3 points to 73.4. Expectations have been below the threshold of 80 that typically signals a recession ahead since February 2025.
Gold prices spiked higher following the 10 am EDT data release, with spot gold turning positive on the session and last trading at $3,838.58 per ounce at the time of writing for a gain of 0.12% on the daily chart.
“Consumer confidence weakened in September, declining to the lowest level since April 2025,” said Stephanie Guichard, Senior Economist, Global Indicators at The Conference Board. “The present situation component registered its largest drop in a year. Consumers’ assessment of business conditions was much less positive than in recent months, while their appraisal of current job availability fell for the ninth straight month to reach a new multiyear low. This is consistent with the decline in job openings.”
“Expectations also weakened in September, but to a lesser extent,” she added. “Consumers were a bit more pessimistic about future job availability and future business conditions but optimism about future income increased, mitigating the overall decline in the Expectations Index.”
Confidence rose for consumers under 35 years old but declined for consumers over 35, the report noted. The evolution of confidence by income group was mixed, with no clear pattern emerging. By income, confidence remained above its April low for all consumer cohorts besides households making between $25K and $35K and those making above $200K. By partisan affiliation, confidence improved slightly among both Republicans and Democrats but dropped substantially among Independents.
“Consumers’ write-in responses showed that references to prices and inflation rose in September, regaining its top position as the main topic influencing consumers’ views of the economy,” Guichard said. “References to tariffs declined this month, but remained elevated and continued to be associated with concerns about higher prices. Nonetheless, consumers’ average 12-month inflation expectations inched down, to 5.8% in September from 6.1% in August. This is still notably above 5.0%, the level at the end of 2024.”
