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Gold came under sharp selling pressure after the latest University of Michigan survey showed a modest improvement in United States consumer sentiment alongside a pronounced rise in inflation expectations. The precious metal traded near its session lows following the report.

Spot gold touched a low of $4,254 per ounce after the final Consumer Sentiment reading was released. It later traded at $4,265.30 per ounce, representing a 0.20% loss for the day.

The University of Michigan said Friday that its final Consumer Sentiment index for September stood at 48.1. That exceeded the preliminary reading of 47.8 and the expected reading of 47.6.

Despite coming in above those two figures, the final September result remained well below the August reading of 51.7. The survey therefore showed that sentiment had deteriorated from the previous month even as the final figure improved slightly from the preliminary estimate.

“Consumer sentiment ticked down less than four index points in September, reaching the lowest reading in four months and down 15% from January 2026,” said Surveys of Consumers Director Joanne Hsu.

The survey also pointed to weakening views about household finances. Consumers continued to express concerns about high prices, while their assessments of both current and expected personal finances deteriorated during September.

“Views of current and year-ahead expected personal finances both weakened about 10% this month, with concerns over high prices continuing to climb,” Hsu said.

Conditions for purchases of durable goods improved somewhat, according to the survey. Respondents partly attributed that improvement to the belief that buying those products now could help them avoid paying higher prices later.

“Buying conditions for durables improved a bit, in part due to a perception that completing such purchases now would help consumers avoid higher prices in the future,” Hsu said.

The report also showed growing pessimism about business conditions in the near term. Concerns centered on elevated fuel prices and renewed trade disputes, along with the possibility that those pressures could spread across the broader economy.

“The short-run outlook for business conditions plunged amid renewed worries that elevated fuel prices and re-escalating trade disputes could pass through to the economy as a whole,” Hsu added.

Political affiliation did not eliminate the bleak assessment. Hsu said interviews revealed broad agreement across the political spectrum that the economic outlook had weakened since the beginning of the year.

“After particularly large declines in sentiment this month, Republican sentiment is now 20% lower than January 2026; Democrats are down 13% over the same period,” she said.

Gold reacted quickly after the survey arrived at 10 a.m. ET. Spot prices sold off sharply in the minutes following the release, placing the market near its lows for the session.

Inflation expectations delivered the report’s most forceful signal. Expectations for inflation one year ahead climbed from 4.0% in the previous month to 4.6% in September, their highest reading since June.

“The current reading substantially exceeds the 3.4% seen in February before the Iran conflict began, along with all 2024 readings,” Hsu wrote.

Expectations over the longer term also moved higher. The measure rose to 3.4% after holding at 3.3% for three consecutive months, according to the survey.

“These expectations remain higher than their 2024 range of 2.8% to 3.2%,” Hsu wrote.

The final sentiment result was stronger than the preliminary reading and market expectation, but the accompanying inflation figures showed that price concerns remained firmly embedded among consumers. Gold’s immediate decline followed a report that paired depressed sentiment with higher inflation expectations.

DISCLAIMER: GoldInvestors.news is not a registered investment, legal or tax advisor or broker/dealer. All investment/financial opinions expressed by GoldInvestors.news are from the personal research and experience of the owner of the site and are intended as educational material. Although best efforts are made to ensure that all information is accurate and up to date, occasionally unintended errors and misprints may occur.