The market sentiment improved amid the slowdown in virus cases. Let's have a closer look at the AUD, S&P 500, gold and the GBP.
American consumer spending goes up in October
In October, American consumer spending went up by the most for seven months. However, underlying price pressures speeded down, with an inflation measure closely watched by the Federal Reserve pointing to its smallest annual leap since February.
On Thursday, the Commerce Department informed that consumer spending, amounting to over 2/3 of American economic activity, went up by 0.6% in October due to the fact American households spent more on utilities and prescription medication.
September’s report was updated downwards to demonstrate spending heading north by 0.2% instead of the previously posted 0.4% profit.
Market analysts had foreseen consumer spending soaring by 0.4% in October. When updated for inflation, US consumer spending managed to rally by 0.4%, which is the biggest leap for seven months. It pointed to a firm tempo of consumption early in the fourth quarter.
Notwithstanding the firm consumer spending, there’re signs that economic surge in the United States is speeding down. This month’s data hinted at a moderation in business spending on equipment. Moreover, the data also pointed to a deterioration in the trade deficit and also worsening weakness in the housing market. Surge estimates for the fourth quarter point to a 2.5% annualized rate. In the July-September quarter the American economy headed north at a 3.5 percent tempo.
In October, spending on products in the United States went up by 0.5% having ascended by 0.1% in September. As for outlays on services, they jumped by 0.7% having jumped by 0.3% in September.
The previous month there was a deceleration in price gains. As for the personal consumption expenditures price index without energy and good, it leapt by 0.1% having surged by 0.2% in September.
It lowered the year-on-year surge in the PCE price index to about 1.8% from November’s reading of 1.9%, which is the lowest result since February.
The overall market sentiment is mixed as new virus cases continue rising throughout the world, but most economic indicators came out better than analysts expected. Let’s look at the main market movements.
The market sentiment switched to risk-off after the Fed’s Powell statement. The USD edged higher, while risker assets started falling after reaching quite high levels. Let’s have a closer look.
The US NFP will be published on August 7 at 15:30 MT time.
The market sentiment is indeed risk-on today. Stocks, riskier currencies and gold are rising amid the waning US dollar.
Follow the BOE monetary policy and rate statements on August 6 at 14:00 MT time…