Friday, 03 April 2015 17:02

Will Consumer Confidence Improve 4th Time Consecutively Amid Softening Economic Growth?

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Today U.S. CB Consumer Confidence will be released at 1500 GMT.

According to analysts expectation the index may fall near to 80.2 from 80.7. Let's see whether leading indicators are supporting this prediction.

In the beginning of the month ISM Manufacturing PMI fell to 51.0 from 57.0. In manufacturing Industry employment fell by 3.5 percentage points and growth slowed down. In Philly Fed Manufacturing index employment fell by 5 points and there was also observed that firms are reducing working hours. Non Manufacturing PMI improved by 1 point and came to 54.0. Employment in service industry rose by 0.8 percentage points and reported faster growth. But high fall of employment in manufacturing could overshadow slight increase in service industry.

U.S. trade deficit rose to -$38.7billion as exports dropped for December. In December, exports shrunk to 1.8 percent to $191.3 billion. This may also drop GDP near to 2.5%.

Nonfarm Employment increased less than expected to 113k from the disappointing result of Jan which was 75k. Job Openings and Labour Turnover Ratio fell to 3.99million from 4.03m which is also a negative sign for labour market.

All negative results dragged down dollar index, measure of dollar compare to basket of 6 major currencies, to 79.92 on 19th Feb and boosted investment in precious metals.

Waning economic growth, slow improvement in labour market and contracting business development may reduce consumer confidence this time.

 

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