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(Kitco News) – The gold market continues to struggle, trading below $1,800 an ounce, and cannot find any support in weak consumer confidence, according to the latest report from the University of Michigan.
On Friday, the University of Michigan said the preliminary reading for its Consumer Sentiment Index fell to 59.7, down from the previous reading of 65.2. the data fell short of expectations as consensus forecasts indicated a small drop to 64.1.
“These declines were broad-based, both for current economic conditions and consumer expectations, and visible across income, age, education, geography, and political affiliation, continuing the overall downward trend in the sentiment over the past year,” the report said. .
According to the report, consumers’ assessment of their current financial situation relative to a year ago is at its lowest reading since 2013.
Economists have noted that rising inflationary pressures are having a significant impact on consumer confidence, as rising prices reduce purchasing power.
“Much of the weakness in the U. Michigan sentiment measure is directly related to higher inflation, with consumers reporting that it is the worst time to buy durable goods since the late 1970s,” said Michael Pearce, Senior US Economist in Capital Economics.
Although confidence data is weaker than expected, the report noted that one-year inflation expectations remain stable, albeit at a high level of 5.4%.
The gold market is not seeing much of a reaction to the data as it continues to be hit by significant selling pressure. June gold futures last traded at $1,808.60 an ounce, down 0.82% on the day.
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