Forex: U. of Michigan Confidence Rose in February; USDJPY Mixed
THE TAKEAWAY: [U. of Michigan Confidence rose to 3-month high in February] > [US consumers continue gain confidence after adjusting their spending according to the new payroll tax] > [USDJPY Mixed]
Consumer confidence in the U.S. rose to the highest level in three months according to a report released by University of Michigan today. The Reuters/U of Michigan February preliminary index of U.S. consumer sentiment increased to 76.3 this month following an increase to 73.8 in January. The U. of Michigan Confidence Index is considered as one of the best leading indicators for future consumption. The median forecast of economists for a survey polled by Bloomberg News had projected a gauge of 74.8 in February. Estimates of the 65 economists ranged from 70 to 79.
In another report released yesterday, fewer workers filed claims for jobless benefits in U.S. adding more positive signs to the outlook of U.S. economy. In addition, employers are not firing aggressively and boosting payrolls at a faster pace as demand holds up. The pickup in wealth resulted from a strengthening job market would help to make up the increase in the payroll tax and maintain the gains in household spending.
USDJPY 1-minute Chart: February 15, 2013
Chart created using Market Scope – Prepared by Renee Mu
In the minute after the U of Michigan Confidence report was released, the U.S. dollar was little changed against its Japanese peer. At the time of this report writen, the USD/JPY was trading higher at 93.58 yen.
--- Written by Renee Mu DailyFX Research
DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.