After the beat on retail sales, US consumers seem to be confident towards Thanksgiving. The headline consumer confidence number is up to 89.4 points, current conditions leap to 103. Inflation expectations are down to 2.6%. Expectations top the 80 line with 80.6 points.
While inflation is low, and this isn’t surprising with lower prices at the pump, the overall picture is bullish. The dollar is slightly stronger but only for a short while. GBP/USD falls temporarily below 1.56, other currencies are not breaking new ground.
US consumer confidence, as measured by the University of Michigan and Reuters, was expected to edge up to 87.3 points in the preliminary read for November, after 86.9 points in October.
The US dollar was on a roll following better than expected retail sales. EUR/USD traded under resistance of 1.2440, GBP/USD was down below 1.5620, USD/JPY traded around 116.60, USD/CAD around 113.40 and AUD/USD around 0.8670.
Retail sales advanced by 0.3% in October, and so did core sales. Core retail sales also enjoyed an upwards revision to the previous fall. This sparked additional US dollar buying, with the exception of the Canadian dollar, that had its own good data.
We will soon have a report on business inventories, which are predicted to rise by 0.3% and mortgage delinquencies.
Update: inventories rise 0.3% as expected.
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