59.85 F
London
June 21, 2024
PI Global Investments
Precious Metals

Gold prices remain range bound as UofM consumer sentiment rises to 78.8


(Kitco News) – The gold market is holding on to its daily gains but could continue to struggle as economic data points to healthy activity and well-anchored inflation.

Friday, the University of Michigan reported a solid rise in its preliminary consumer sentiment survey. The index rose to 78.8, its highest level since July 2021, and up from December’s reading at 69.7.

The economic data significantly beat economists’ expectations, as consensus forecasts called for a relatively unchanged reading.

The gold market, while off its lows from earlier in the week, remains fairly rangebound, seeing little movement in initial reaction to positive consumer sentiment data. February gold futures last traded at $2,029.10 an ounce, up 0.37% on the day.

Joanne Hsu, director of consumer survey at the university, said that the solid rise in sentiment “is no fluke.”

“Consumer views were supported by confidence that inflation has turned a corner and strengthening income expectations. Over the last two months, sentiment has climbed a cumulative 29%, the largest two-month increase since 1991 as a recession ended,” Hsu said in the report.

Along with the growing optimism, the  report also also noted a sharp drop in inflation expectations, which could be positive for gold in the near-term.

According to survey responses, consumers see inflation rising 2.9% by this time next year, down compared to a forecasted rise in December of 3.1%.

“The current reading is the lowest since December 2020 and is now within the 2.3-3.0% range seen in the two years prior to the pandemic. Long-run inflation expectations edged down to 2.8% falling just below the 2.9-3.1% range seen for 26 of the last 30 months,” Hsu said.
 

Disclaimer: The views expressed in this article are those of the author and may not reflect those of Kitco Metals Inc. The author has made every effort to ensure accuracy of information provided; however, neither Kitco Metals Inc. nor the author can guarantee such accuracy. This article is strictly for informational purposes only. It is not a solicitation to make any exchange in commodities, securities or other financial instruments. Kitco Metals Inc. and the author of this article do not accept culpability for losses and/ or damages arising from the use of this publication.



Source link

Related posts

Vietnam to auction gold for first time in a decade

D.William

Gold extends record run as rate cut bets gain ground

D.William

Should You Hold McEwen Mining Inc (MUX) in Other Precious Metals & Mining Industry?

D.William

Leave a Comment

* By using this form you agree with the storage and handling of your data by this website.