The decline of the US consuming sentiment survey of US UN Michigan to its lowest level since 1980 at 59.5 could offset the US housing starts rise by 8.2% which is the highest rate in 2 year. The US housing starts increased to 947k in April from 1032k in March and also the building permits increased from 920k to 978k. The greenback has risen after the surprising overshooting housing figures but the disappointing consuming sentiment figure has brought back the soft tone to the greenback which was trading in a narrow range versus the major currencies.
We have had this week the US NY manufacturing index which has declined to the negative territory by 3.23 and the US net long term TICS of March which were 54.2b and also earlier this week we have had April US CPI rate which came lower than the market expectations of 4% y/y at 3.9 % and also the core CPI excluding food and energy which has come too lower than the market expectations of 2.4%. The slower pace of inflation can help Fed's monetary easing impact as the inflation can tackle this impact.
The greenback was underpinned recently by this week release of US April core retail sales release which increased by .5% m/m and the increased believe that the huge loses which have hit the crediting market are over as the current cautiousness of further disclosures as what Ben Bernenke was calling recently and the housing market slump will have a close end. So today's US housing data were closely watched and actually, it has come optimistic supporting the greenback slumping by the US Michigan consuming sentiment dovish figure.
Best wishes
FX Consultant
Walid Salah El Din
E-Mail: mail@fx-recommends.com
