Gold Falls as Consumer Sentiment Dives Below Expectations

Spot gold prices declined on Friday after the release of consumer sentiment data from the University of Michigan. The final reading for August came in at 51.7, which was better than expected but still a drop from July's reading of 55.2. According to Surveys of Consumers Director Joanne Hsu, 'Consumer sentiment confirmed its early month reading, falling about 6% from last month and landing about 11% below a year ago amid continued worries that inflation will remain elevated for the foreseeable future.'

The data showed that consumer sentiment declined across all political groups, with particularly sharp drops among Republicans. Those who are less equipped to absorb cost of living increases also exhibited stronger decreases in sentiment, including older consumers and those with lower- or middle-income households.

The year-ahead inflation expectations ticked down from 4.2% in July to 4.0%, while longer-run expectations held steady at 3.3%. Spot gold prices fell to a session low of $4,549.15 after the data release and last traded at $4,556.41 per ounce for a loss of 0.99% on the day.