Stronger-than-expected U.S. consumer sentiment and easing inflation expectations lifted gold futures Friday, offsetting weekly losses.
Gold futures climbed back above $4,000 Friday after the University of Michigan’s July consumer sentiment index rose to 54.4, beating expectations. The report also showed shorter-term inflation expectations cooling, easing pressure on the Federal Reserve to maintain aggressive rate hikes.
The weekly decline followed heightened geopolitical tensions between the U.S. and Iran, which had stoked speculation of tighter monetary policy. Gold remains sensitive to inflation data and Fed policy signals, with traders balancing safe-haven demand against rising interest rate expectations.
Markets await next week’s inflation reports for further direction, as gold’s short-term outlook hinges on whether the Fed extends its hiking cycle.