The University of Michigan’s consumer sentiment figure fell short of expectations with a headline score of 83.9 points. It was expected to advance from 84.1 to 85.3 points, extending the trend. Consumer sentiment is theoretically correlated with spending and with retail sales, but this is not always the case.
EUR/USD just above 1.30, after making a drop to this round number earlier. USD/JPY was above 99, within the day’s range. GBP/USD was just below 1.51 and AUD/USD recovered from the dip under 90 and traded around 90.50. The US dollar is now a bit lower across the board. The weaker dollar move is against the trend so far today, and could reverse.
Some details: Inside the report, not all is gloomy: inflation expectations are up from 3% to 3.3% in the next year, and stand at 2.9% for 5 years. It doesn’t seem that deflation is near. Not yet at least. In addition, conditions jumped from 93.8 to 99.7 points, beating expectations of 94 points. However, expectations fell from 77.8 to 73.8 points, significantly below 76 expected.
Earlier, the US released producer prices and they rose by 0.8%, more than expected. All in all, the dollar is enjoying a correction after a bad week beforehand.
Bernanke’s words still echo. Was he really that dovish? He didn’t really say anything new, and didn’t really mention QE tapering.
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