Friday, October 17, 2008
ForexYard Indicator Report
| by: Forexyard Be Prepared! U.S. Preliminary UoM Consumer Sentiment Tomorrow at 13:55 GMT We at ForexYard encourage our customers to get involved in the most intense market events. As such, we think you should know that the U.S. Preliminary UoM Consumer Sentiment figures are expected tomorrow, October 17th, 13:55 (GMT), and you need to be prepared. Market events like this one tend to create either big changes to current trends or push current trends even further. Generally, the Majors are the ones most affected by market events in general, but Crude Oil, Gold prices, and even the price of Silver can change dramatically in the seconds after such a publication. For more information about the U.S. Preliminary UoM Consumer Sentiment, please read below. What is the U.S. Preliminary UoM Consumer Sentiment Indicator? The Preliminary UoM Consumer Sentiment Indicator is a survey of consumer confidence conducted by the University of Michigan. This is a telephone survey which gathers information on consumer expectations regarding the overall economy. It measures the attitudes and expectations concerning both present and future economic conditions of 500 consumers. They are asked about how they see their own financial futures and opinions on the prospects for the U.S. economy. It is an early assessment of consumer sentiment regarding personal finances, business conditions and purchasing power. There are two versions of this data released about 15 days apart - Preliminary and Revised. The Preliminary release is the earliest and thus tends to have the most impact; it is released around the 10th of each month. A final report for the prior month is released on the first of the month. Just like Consumer Confidence, the level of consumer sentiment is directly related to the strength of consumer spending. The more confident consumers are about the economy and their own personal finances, the more likely they are to spend. The index is useful for the investors because it gives a snapshot of whether consumers feel like spending money. If the Survey Comes Inline with Market Forecasts Economists are looking for consumer sentiment to decline to the level of 66.0, as opposed to September when it surprisingly jumped to 73.1. The market anticipates such a low reading because Americans are still in doubt about the fragile economy and financial instability. Such pessimism has been fueled by a cocktail of consumer woes: higher gasoline prices, food costs, falling home values and weaker income growth. The recent acceleration in the loss of confidence indicates a longer and potentially deeper recession. Consumers are viewing the deteriorating economic conditions in the U.S. and seeing very little hope for recovery anytime soon. A low or falling UoM Consumer Sentiment will be considered an early indicator of an economic downturn. As a result, investors and traders are advised to watch the figure for insight into the general health of the economy. In this case, the greenback's latest bullish trend is not likely to extend any further, and the EUR/USD might rise to test the 1.4000 level in the near future. If the Survey Will Surprise With Bullishness If the actual figure is higher than forecasted, traders are likely to see the USD appreciating against its currency pairs and crosses. A positive figure will reflect a better-than-forecasted mood of U.S. consumers, meaning the public has regained some of its faith in the economic system. The improvement may also reflect consumer happiness that the government appears to be taking action. As a result, this positive data may further extend the USD's recent bullish trend to help it reach as low as 1.3200 against the EUR. Labels: Forex Analysis, FX Instructor |
posted by Matbank at 12:35 AM
