The gold market is setting fresh session highs ahead of the weekend after the latest data showed consumer sentiment in the U.S. declining, while inflation expectations ticked lower.

The University of Michigan announced on Friday that the final reading of its Consumer Sentiment survey for December was 52.9. The data was worse than expectations, as the consensus forecast of economists called for a reading of 53.5 after the preliminary reading of 53.3, but it was still above November’s final reading of 51.

“Consumer sentiment confirmed its early month reading, inching up less than two index points from November, within the margin of error,” said Surveys of Consumers Director Joanne Hsu. “While lower-income consumers posted gains, sentiment for higher-income consumers was little changed. Buying conditions for durable goods fell for the fifth straight month, whereas expectations for personal finances and business conditions rose in December.”

She noted that labor market expectations rose slightly this month, “though a solid majority of 63% of consumers still expects unemployment to continue rising during the next year.”

“Despite some signs of improvement to close out the year, sentiment remains nearly 30% below December 2024, as pocketbook issues continue to dominate consumer views of the economy,” Hsu added.

Gold prices shot to session highs following the 10 am EST data release, with spot gold last trading at $4,343.17 per ounce for a gain of 0.24% on the day.

The December index showed some improvement in price pressures, with both short-term and longer-term inflation expectations receding.

“Year-ahead inflation expectations decreased for the fourth consecutive month to 4.2%,” Hsu said. “This is the lowest reading in 11 months but is still above the 3.3% seen in January. Long-run inflation expectations eased from 3.4% last month to 3.2% in December, matching the January 2025 reading. In comparison, readings ranged between 2.8 and 3.2% last year, and were below 2.8% throughout 2019 and 2020.”

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