The US economy received positive data last night, in the form of the Consumer Confidence figure. The figure was released well above the expected 85.4, coming in at 90.9. Considering last month’s figure was only 86.4, it shows that consumers in the US have experienced a considerable increase in sentiment over the last month.
However, it seems not all is well in the US economy as US Home Sales have taken a hit again. The Housing sector has shown contraction in the last two months. Typically, housing data is correlated with Consumer Confidence data. The reason for this is that when there is positive sentiment in the economy, generally, consumers will spend more on goods and services, this including long term investments and durable goods. Therefore, US consumers have experienced additional sentiment this month, a lag effect may follow on to next month.
This Thursday investors are expecting the US economy to improve on their Gross Domestic Figures. Analysts are expecting an improvement from the last disappointing figure of 1.3% on a quarterly figure and -3.1% YoY. They are expecting 1.8% this month, which would be big improvement and may give the USD some overnight strength; however, it will depend on how actual figures differ from expectations.
Lastly, US Unemployment Figures is set to be slightly weaker at the end of the week. Analysts are expecting 213K jobs created from a previous figure of 288K. The US Unemployment figure is set to remain on 6.1%. Given that the investors are expecting a slight contraction on jobs this may mean a last minute strengthening of the AUD.