The gold market hit session highs near $4,080 per ounce on Friday after the University of Michigan announced the final Consumer Sentiment reading for June rose to 49.5, exceeding both the preliminary reading of 48.9 and May's final reading of 44.8. The improvement came as gas prices moderated and consumers' worries over long-term consequences of the Iran conflict appeared to ease, according to Surveys of Consumers Director Joanne Hsu. Both year-ahead and long-run inflation expectations declined from May levels, with year-ahead expectations falling to 4.6% from 4.8% and long-run expectations dropping to 3.3% from 3.9%. The data release triggered an immediate rally in spot gold, which last traded at $4,074.13 per ounce for a gain of 1.17% on the day. Despite the monthly improvement, sentiment remains 13% below the February 2026 reading prior to the start of the Iran conflict, with over half of consumers citing high prices as weighing down their personal finances for the third consecutive month.
University of Michigan Consumer Sentiment Index Rises to 49.5 in June
The University of Michigan's final Consumer Sentiment survey reading for June came in at 49.5, slightly below the consensus forecast of 50 but above the preliminary reading of 48.9 and well above May's final reading of 44.8. "Consumer sentiment confirmed its early-month reading, rising about 10% above May as gas prices moderated," said Surveys of Consumers Director Joanne Hsu. "Increases were seen across income, wealth, and political affiliation. Expected business conditions over the next five years surged 16% as consumers' worries over long-term consequences of the Iran conflict appear to be easing."
Hsu noted that sentiment remains in unfavorable territory at 13% below the February 2026 reading prior to the start of the Iran conflict, and nearly 20% less than a year ago. "The cost of living remains at the forefront of consumers' minds; for the third straight month, over half of consumers spontaneously mentioned that high prices are weighing down their personal finances," Hsu stated.
Year-Ahead and Long-Run Inflation Expectations Decline in June
The June index showed a drop in both year-ahead and longer-run inflation expectations, though these remained high by historical standards. "Year-ahead inflation expectations inched down from 4.8% in May to a still-elevated 4.6% this month," Hsu wrote. "The current reading substantially exceeds the 3.4% reading seen in February before the Iran conflict began, along with all 2024 readings."
Long-run inflation expectations fell back from 3.9% last month to 3.3% in June, remaining a bit higher than the 2.8% to 3.2% range seen in 2024, according to the survey data.
Spot Gold Reaches $4,074.13 Per Ounce Following Data Release
Spot gold shot to a fresh session high and was testing the $4,080 per ounce level after the 10 am ET data release. The precious metal last traded at $4,074.13 per ounce for a gain of 1.17% on the day, according to Kitco News market data.
FAQ
What was the final Consumer Sentiment reading for June announced by the University of Michigan?
The University of Michigan announced on Friday that the final reading of its Consumer Sentiment survey for June was 49.5, slightly better than the consensus forecast of 50 and above the preliminary reading of 48.9.
How did spot gold prices react to the Consumer Sentiment data release?
Spot gold shot to a fresh session high near $4,080 per ounce after the 10 am ET data release and last traded at $4,074.13 per ounce for a gain of 1.17% on the day.
What were the year-ahead and long-run inflation expectations in June?
Year-ahead inflation expectations fell to 4.6% in June from 4.8% in May, while long-run inflation expectations dropped to 3.3% from 3.9% last month, according to the University of Michigan survey.
