Consumer Confidence hits record low in October. House Prices decline. Dollar falls in Forex Trading. | CountingPips Forex Blog

October 28, 2008 - Forex Economic News

U.S. Consumer Confidence hits record low in October. House Prices decline. Dollar falls in Forex Trading.

U.S. Consumer Confidence hit a record low in October according to the Conference Board Consumer Confidence Index released today. The consumer index, representing responses from 5,000 U.S. households, showed that consumer confidence fell to a 38.0 score this month following a revised 61.4 score in September. The October score marks the lowest confidence score in the Conference Board Index since the beginning of the index in 1967 and surpassed USD falls in Fx Trade. economic forecasts that were expecting a 53.0 point score. The present situation section of the index declined to 41.9 from 61.1 in September while the expectations index fell from 61.5 in September to 35.5 this month.

Consumer confidence fell in the areas of business and employment as respondants feeling that business conditions are "bad" increased by 4.9 percent while those saying jobs are "hard to get" increased by 5.0 percent. Looking forward, consumers also felt that things would get worse as consumers think business will worsen by 15.6 percent over last month and that consumers expect fewer jobs in the coming months by 14.6 percent more than last month.

Lynn Franco, the Director of The Conference Board Consumer Research Center commented in the report on the mood of the consumer, "The impact of the financial crisis over the last several weeks has clearly taken a toll on consumers' confidence. The decline in the Index (-23.4 points) is the third largest in the history of the series, and the lowest reading on record. In assessing current conditions, consumers rated the labor market and business conditions much less favorably, suggesting that the fourth quarter is off to a weaker start than the third quarter."

S&P Case-Shiller Index House Prices fall in August.

Home prices in the U.S. continue to decline as the Standard & Poors/Case-Shiller index released today showed that home prices fell new record amounts in August when compared to a year ago. The S & P’s/Case-Shiller Home Price Index measures sale prices of existing single-family homes nationally and tracks 10-city and 20-city composite home price measurements. The August house prices report showed that the 20-city composite index fell an annual 16.6 percent to mark a new record low while the 10-city composite index also fell a new record low 17.7 percent in August compared to last year.

The areas hardest hit continued to be Las Vegas and Phoenix with annual declines of 30.6 percent and 30.7 percent, respectively. On an annual basis, none of the 20 metropolitan areas measured have shown house price increases with Dallas and Charlotte being the areas with the lowest declines at 2.7 percent and 2.8 percent, respectively. On a monthly basis, San Francisco registered the largest house price decline with a fall of 3.5 percent while Cleveland registered the largest growth for the month with a rise of 1.1 percent.

David M. Blitzer, Chairman of the Index Committee at S & P, commented in the report, "The 10-City Composite and the 20-City Composite reported record 12-month declines. Furthermore, for the fifth (5th) straight month, every region reported negative annual returns. This started when Charlotte, NC, was the last region to turn negative back in April 2008. Both the 10-City and 20-City Composites have been in year-over-year decline for 20 consecutive months. Of the 20 regions, 13 of them had their annual returns worsen from last month’s report."

Forex - U.S. dollar falls in Forex Trading.

The U.S. dollar has lost ground against the euro, pound, aussie, kiwi, loonie and the Swiss franc in the forex market today while gaining against the Japanese yen. The euro has increased from today's opening of approximately 1.2430 dollars per euro to trading at 1.2556 in the afternoon of the US trading session at 2:38pm ET. The British pound has also gained from today's opening exchange rate of 1.5549 dollars per pound to trading at approximately 1.5713. Also gaining ground verses the dollar today is the Swiss franc at 1.1601, the aussie dollar at 0.6332, the kiwi dollar at 0.5581 and the Canadian loonie at 1.2954. The U.S. dollar, despite its fall verses the other majors, has jumped today against the Japanese yen. The USD/JPY has gained from its 93.74 opening exchange rate to trading in the afternoon U.S. session at 97.38 yen per dollar.

Tomorrow's forex trading action should prove to be interesting as the U.S. Federal Reserve is poised to lower interest rates again with forecastors expecting a 0.50 percent rate reduction.

USD/JPY Chart - The US Dollar making big gains today against the Japanese yen(Daily Chart).

Today's Forex Chart

tags: house prices, consumer confidence, forex trading

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