(Kitco News) – The gold market holds on to strong gains and sees little reaction as US consumers feel less optimistic in June.
Tuesday, the US conference board said that the consumer confidence index fell to a reading of 121.5, down from May's reading of 134.10 and lacking expectations. According to consensus forecasts, economists expected to read about 132.0.
According to the report, this is the lowest reading since September 2017.
The gold market sees little response to weaker than expected data. However, disappointing consumer sentiment may continue to weigh on economic growth expectations and support further interest rate cuts from the Federal Reserve, according to some economists.
August gold futures last traded at $ 1
The report showed broad weakness with the current situation index falling to 162.60, down from May reading of 170.7. However, the exploration index fell to 94.1, down from the previous level of 105.
The Conference of Supervisors also warned that consumer sentiment could fall further as the US-China trade tension escalates.
"The decline in today's situation index was driven by a less favorable assessment of business and labor relations. Consumers' expectations of short-term prospects also declined," said Lynn Franco, senior director of economic indicators at The Conference Board. And tariff tensions earlier this month seem to have shaken consumer confidence. While the index remains at a high level, continued uncertainty can lead to further volatility in the index, and may even begin to reduce consumer confidence in the expansion. "
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