Trading activity has slowed ahead of the extended weekend break in the US and London. The dollar resumed its upward march pilling further pressure on gold. London stocks were flat at the closing bell on Friday as traders assessed mixed economic data and awaited a speech from Federal Reserve chair Janet Yellen.
UK consumer confidence improved in May, according to a survey. GfK’s consumer confidence index improved to -1 in May from -3 a month earlier, beating estimates for a reading of -4.
It is a relief that consumer confidence was a little firmer in May following April’s drop to a 16-month low, but the suspicion is that consumers will be cautious in their spending amid heightened uncertainty in the run-up to the 23 June referendum on UK membership of the European Union.
At the same time, a declaration at the G7 meeting in Japan said a vote by the UK to leave the EU would pose a “serious threat to global growth”.
The group warned in its final statement that Brexit would reverse the trend of increased global trade, investment and jobs.
In the US, the Commerce Department’s second estimate of first quarter gross domestic product was for a 0.8% rise at a seasonally-adjusted rate, up from the initial estimate of 0.5% but a touch below expectations of 0.9%.
Meanwhile, consumer spending was up 1.9%, in line with the initial estimate and outlays on new home construction rose at a rate of 17.1% compared to an initial estimate of 14.8%.
Consumer sentiment in the US improved less than expected in May, according to the final reading from the University of Michigan.
The University of Michigan’s consumer sentiment index printed at 94.7, down from the initial estimate of 95.8 but above the April reading of 89.0 and the May 2015 reading of 90.7.
Federal Reserve chair Janet Yellen was due to give a speech in Harvard, which investors will be scrutinising for any further clues on the timing of the next interest rate hike.
In commodities, oil prices were under the cosh as supply glut concerns persisted. Brent crude fell 0.52% to $49.33 per barrel
Gold was down again on Friday and $39 over the week to its lowest since the start of April.