Personal spending, an important gauge of consumer confidence in the US, rose by 0.7%, slightly better than 0.6% that was expected. The dollar is slightly stronger, with EUR/USD at important support.
This 0.7% rise in personal spending comes on top of a rise of 0.3% recorded last month – the figure was revised to the upside.
In other US news, Core PCE Price Index rose by 0.2% as expected, and also here, last month’s rise was revised to the upside – 0.2% instead of 0.1%. Personal income rose by only 0.3%, instead of 0.5% that was expected, but also here, there was an upwards revision of the previous figure from 1% to 1.2%.
EUR/USD now trades at 1.4030, exactly at the important and distinctive support line, that currently holds well. For more technical levels and events, see the EUR USD Forecast.
Earlier, the dollar was showing strength against the Euro and the pound. Both weakened as the talks about defaults for Irish banks intensified.
The Euro also weakened on the soaring Portuguese yields that indicate that the bailout is coming. The Portuguese government collapsed last week.
The pound lost ground also on the serious public disapproval of the government’s austerity measures and the general weakness of the economy, even before the measures were introduced.
On the other side of the world, the Australian dollar strengthened and reached new historic highs, continuing the move from last week, and enjoying rising commodity prices.
Later today we have an even more important release: pending home sales. The US housing sector is relatively weak, and this could weigh on the dollar. The fear of another disappointing figure in the housing sector prevents further moves.
