US personal spending slides – USD follows but recovers


The biggest surprise from US economic indicators came from personal spending, that dropped 0.1% instead of rising by 0.2% as expected. This is the first fall since January. Personal income also disappointed by rising only 0.2% and the Core PCE Price Index did not surprise and rose by 0.1% once again.

The US dollar is ticking lower following these numbers.

The US Core PCE Price Index was expected to rise by a modest 0.1% in July, after +0.2% in June. Year over year, June saw a rise of 1.6%. This is a key indicator for the Fed: Yellen and co. see this as a primary measure of inflation, giving a better indicator than CPI, Core CPI and other measures. More indicators were released at the same time.

Before the publication, EUR/USD was trading just under 1.3190, GBP/USD was around 1.6580 and USD/JPY just under 104.

The US dollar dropped just a bit: EUR/USD rose above 1.3190, GBP/USD ticked lower and USD/JPY moved away from 104.

The data

  • Core PCE Price Index: +0.1%, year over year +1.5%, +0.1% m/m expected.
  • Personal Spending: -0.2%, +0.2% m/m expected.
  • Personal Income: +0.2%, exp. +0.2%.

We still have two more important US indicators today:

  • The Chicago PMI, which is expected to rise to 55 points.
  • Revised consumer sentiment by the University of Michigan. The initial figure showed 80.1 points.

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About Author

Yohay Elam – Founder, Writer and Editor I have been into forex trading for over 5 years, and I share the experience that I have and the knowledge that I’ve accumulated. After taking a short course about forex. Like many forex traders, I’ve earned a significant share of my knowledge the hard way. Macroeconomics, the impact of news on the ever-moving currency markets and trading psychology have always fascinated me. Before founding Forex Crunch, I’ve worked as a programmer in various hi-tech companies. I have a B. Sc. in Computer Science from Ben Gurion University. Given this background, forex software has a relatively bigger share in the posts.

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