There has been much to do about how tensions in Ukraine are impacting equity markets, but certain factors in the U.S. are also causing fluctuations.
For example, consumer confidence recently decreased to a four-month low, which led to the U.S. dollar to posting losses against the euro, according to Daily Forex.
The Thomson Reuters/University of Michigan preliminary index of consumer sentiment unexpectedly decreased to 79.9 this month, according to Bloomberg. Economists surveyed called for an increase to 82. The drop was caused by a more pessimistic view on the outlook of the economy, as consumers need faster wage growth to help boost confidence.
“The winter weather is not a reason to get rosy about the economy or personal finances, so we’re seeing consumers hold here,” Sean Incremona, a senior economist at 4cast Inc. in New York, who projected a decline in the gauge to 80.5, told the news source. “The job market should continue to improve, albeit at a moderate pace, and we hope eventually we will see increased wages, which will be the real factor to drive spending and sentiment.”
Investors who trade forex should keep a close eye on future consumer confidence releases to see how it impacts the EUR/USD. This is just the preliminary report of the Thomson Reuters/University of Michigan index, as the month comes to a close, there will be another report that should provide a more clear view as to the direction of consumer confidence.
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Article provided by HY Markets Forex Blog