USD: Economic reports offer some support amidst political uncertainty – AmpGFX
|Analysts at Amplifying Global FX Capital explain that while the political uncertainty has knocked back the USD, some more recent economic reports suggest the US economy retains momentum and the labor market is tightening.
Key Quotes
“The Philadelphia Fed Activity index was very strong, contrasting with the weak Empire State (NY) index released on Monday. These are the first two of the regional surveys to be released, several more come next week, including the preliminary Markit PMI data. The tone of this data will be important to keep the USD from falling further. The market is likely to react more to evidence that the US economy is faltering.”
“Also supporting the USD today was unemployment claims that suggest that the labor market is getting quite tight.”
“The leading index rose 0.3%m/m, not as much as expected, and revised down a bit last month, but it still strong enough to suggest the economy has significant momentum.”
“Much attention will turn to sentiment surveys that have not had a chance to take on the full force of the latest controversy. The weekly Bloomberg Consumer Comfort index rose a bit, and remains at a high level. It would have at least taken in some of the controversy that started with the firing of Comey. However, it did show a dip for a third week in the survey of perceptions of the national economy.”
“One interesting feature of this survey is the contrast between survey results for Republicans and others. Republicans are professing increased confidence this year, while Democrats and independents have high, but fading confidence recently. One wonders in Republican feel the need to show defiance with their survey responses as their party and President come under attack.”
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