US consumer confidence surpassed expectations and boosted the market: the price of gold reversed decline and turned upward on Friday and stabilized at the $4,000 mark

The Zhitong Finance App noticed that after the latest US economic data showed improved consumer confidence and short-term inflation expectations eased, gold futures reversed their decline and turned upward on Friday.

The initial value of the University of Michigan's July monthly consumer confidence survey was 54.4, better than expected, higher than the final value of 49.5 in June and the final value of 44.8 in May.

The one-year inflation forecast for this month fell slightly from 4.6% to 4.2%, although this reading is still higher than the 3.4% seen in February before the US-Iran conflict began.

Since the war began in late February, the price of gold has fallen by about 25% due to market expectations that inflation caused by the war may maintain high interest rates for a longer period of time, and the pressure is heavy.

Although some weaker-than-expected US inflation data released this week eased bets that the Federal Reserve will tighten monetary policy, the escalating hostilities between the US and Iran have raised investors' concerns that higher energy prices may maintain high inflation and prompted the Federal Reserve to raise interest rates.

Soojin Kim, an analyst at Mitsubishi UFG Financial Group (MUFG), said in the report: “Recent price trends show that compared to the traditional safe-haven demand for gold, the market is currently giving greater weight to the prospect of 'US interest rates remaining high for a longer time'. This makes gold appear more vulnerable, unless geopolitical risks translate into a wider deterioration in financial market sentiment.”

The previous month's gold futures for July delivery on the New York Mercantile Exchange rose 0.7% to $4,012.70 per ounce; the previous month's silver futures for July delivery rose slightly by 0.2% to $56.038 per ounce. Looking at the whole week, gold and silver fell 2.2% and 6.3%, respectively.