US Consumer Spending slows, UMichigan Confidence drops. US Dollar gains in forex trading. | CountingPips Forex Blog

October 31, 2008 - Forex Economic News

US Consumer Spending slows, UMichigan Confidence drops. US Dollar gains in forex trading.

U.S. Consumer spending decreased in the month of September according to a new release by the U.S. Commerce Department today. Personal consumer spending decreased by 0.3 percent in September, marking the largest decline in spending since June of 2004. Personal spending had been unchanged in August and July after increasing by 0.5 percent in June and by 0.7 USD gains in Forex Trading percent in May of this year. The spending decline was a bit beyond market forecasts expecting a 0.2 percent decline and shows a sign of a stalling economy as consumer spending makes up approximately two-thirds of U.S. economic activity.

Personal income, meanwhile, rose in September by 0.2 percent according to the report after increasing by a revised 0.4 percent in August. Forecasts were calling for a 0.1 percent rise of income in September.

UMichigan Confidence Survey falls record amount.

The final figures for the October University of Michigan/Reuters consumer confidence survey showed that the survey fell a record amount from September. The UMichigan/Reuters consumer sentiment index score fell to 57.6 in October, down from a 70.3 score in September and establishing a new record monthly decline. The current conditions index, which measures present economic sentiment, declined from 75.0 in September to a new record low of 58.4 in October while the expectations index declined from 67.2 in September to 57.0 in October.

Richard Curtin, Director of the Reuters/University of Michigan Surveys, stated in the report that “Consumer confidence had already declined by mid-2008 by more than prior to any past recession and the steep October loss indicates that accelerated cutbacks in spending can be expected during the months ahead.”

US Dollar gains in forex trading on last day of October.

The U.S. dollar has been rising in forex trading today as it has gained against the euro, pound, loonie, aussie, kiwi and Swiss franc while being virtually unchanged against the Japanese yen.

EUR/USD

The EUR/USD pair has declined slightly from today's opening rate of 1.2853 dollars per euro to trading at 1.2758 near the end of the US trading session at 4:25 pm ET. The EUR/USD has advanced slightly for this week but has declined enormously for the month of October as the credit crisis turmoil has been the story of the month and has favored a dollar advancement.

GBP/USD

The GBP/USD has declined from opening at 1.6390 to trading today at 1.6088 dollars per pound. The GBP/USD is on pace to close the week higher after declining last week but has fallen this month to the dollar.

USD/JPY

The USD/JPY has been virtually unchanged in today's trading at the exchange rate of 98.51 after opening at 98.59 yen per dollar earlier today. The USD/JPY has increased this week after a week of decline last week. On a monthly basis, the USD/JPY has declined in October after also declining in September as the yen has been the biggest beneficiary of the latest credit crisis.

USD/CAD

The dollar has gained very slightly against the Canadian loonie today after advancing yesterday as the USD/CAD has advanced from today's 1.2117 open to trading at the exchange rate of 1.2127. The USD/CAD, on a weekly basis, has fallen this week but has advanced greatly for October.

USD/CHF

The dollar has advanced against the Swiss franc today as the USD/CHF has increased from 1.1388 to 1.1570. The USD/CHF is declining for the week after a gain last week but has advanced for the month of October.

AUD/USD

The dollar has advanced against the Australian Aussie as the AUD/USD is trading at 0.6653 today after opening at 0.6741. On a weekly basis, the AUD/USD is gaining for this week after falling last week but has fallen for the month of October.

NZD/USD

The New Zealand kiwi has declined today against the U.S. dollar. The NZD/USD has fallen to the 0.5836 level today after opening at 0.5884. The NZD/USD has also gained for the week but has declined considerably in October.

GBP/USD Chart - The British Pound dropping this month against the US Dollar in Forex Trading(Monthly Chart).

Today's Forex Chart

tags: consumer spending, consumer confidence, forex market

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