{"id":156055,"date":"2019-09-24T11:16:40","date_gmt":"2019-09-24T15:16:40","guid":{"rendered":"https:\/\/www.countingpips.com\/?p=156055"},"modified":"2019-09-24T11:16:40","modified_gmt":"2019-09-24T15:16:40","slug":"solid-us-wages-support-consumer-confidence","status":"publish","type":"post","link":"https:\/\/www.investmacro.com\/forex\/2019\/09\/solid-us-wages-support-consumer-confidence\/","title":{"rendered":"Solid US Wages Support Consumer Confidence?"},"content":{"rendered":"
September 24, 2019<\/div>
\r\n<\/div><\/div>

By <\/strong>Orbex<\/strong><\/a><\/p>\n

Consumer Confidence\u00a0continued to recover in August at a faster pace than economists had anticipated.\u00a0<\/strong><\/p>\n

It closed the gap from June\u2019s decline at 121.5 and improved the positive average.<\/p>\n

Expectations are for the CB\u2019s monthly index\u00a0to edge slightly higher in September.\u00a0<\/strong><\/p>\n

However, the\u00a0markets expect the numbers to uptick only 20 basis points above August\u2019s print of 135.1, at 135.3.<\/p>\n

\"us<\/a><\/p>\n

Consumers Remain Confident<\/strong><\/h2>\n

In 2019 so far, consumer attitude showed a\u00a0greater appetite for spending<\/strong>\u00a0than analysts had expected.<\/p>

\r\n
\r\n

Free Reports:<\/p><\/div>\r\n

\r\n

<\/a>\r\n\t Get Our Free Metatrader 4 Indicators<\/u><\/b><\/a> - Put Our Free MetaTrader 4 Custom Indicators on your charts when you join our Weekly Newsletter<\/p>

\r\n
\r\n
\r\n

<\/a>\r\n\t Get our Weekly Commitment of Traders Reports<\/u><\/b><\/a> - See where the biggest traders (Hedge Funds and Commercial Hedgers) are positioned in the futures markets on a weekly basis.<\/p>

\r\n<\/div>\r\n

\r\n
<\/div>\n

With Q3 nearing its end, September\u2019s release will mark whether this should continue to be the case into the last quarter of a rather problematic year or not.<\/p>\n

Considering a 10 basis point divergence when comparing releases that missed versus releases that beat estimations,\u00a0this month will end up marking Q3 consumer confidence either as a worse or better than expected quarter<\/strong>.<\/p>\n

Hence, the quarter factor makes this event special. And this\u00a0could have a significant effect on the liquidity injected into the markets<\/strong>\u00a0during the release.<\/p>\n

Rise in Wages Could Support Sentiment<\/strong><\/h2>\n

US average hourly earnings rose 0.4% month-on-month in August.\u00a0<\/strong>This is\u00a0despite the labor market sliding 28K below expectations.<\/p>\n

Hourly wages increased by 11 cents, which is higher than the 8 cents expected. It\u2019s also the largest increase since February. In 2019 so far,\u00a0wages remained somewhat elevated<\/strong>, supporting better GDP figures.<\/p>\n

The year-on-year figures trade right at the long-term average of 3.2%<\/strong>. The bad news is that\u00a0wages grow way faster than inflation<\/strong>\u00a0does.<\/p>\n

Inflation is stuck below the Fed\u2019s target of 2%, at 1.7%. This comes as\u00a0energy deflation tumbled 4.4% in August.<\/strong>\u00a0With the Fed lowering rates<\/a>,\u00a0inflation should start picking<\/strong>\u00a0again as consumers will have more to spend, and this should at least support CB in the short to medium term.<\/p>\n

ISM Could Show Positive Economic Direction<\/strong><\/h2>\n

The ISM Manufacturing index fell to contractionary levels<\/strong>\u00a0in September. Regardless of a forecast of 51.1, data from monthly replies indicated that the PMI responded badly to the effects of poor employment. The\u00a0employment component fell 4.3%<\/strong>\u00a0compared to July.<\/p>\n

The ISM report reflected a decline in business confidence and considerable cracks from a\u00a0large contraction in new export orders<\/strong>. Not only is this a reason to alarm the labor market, but it also triggers an underlying fear of a potential recession.<\/p>\n

With trade, rather than the trade wars remaining as the most significant issue, the\u00a0ISM forecasts hint to stronger demand for new orders<\/strong>. These expectations could reflect a notable increase in business confidence, hence add on to optimistic sentiment.<\/p>\n

The question now is: will US consumers take sentiment from the Fed\u2019s cut or is it too early to inherent optimism amid a\u00a0lingering trade war<\/a>?<\/p>\n

By <\/strong>Orbex<\/strong><\/a><\/p>\n

 <\/p>\n","protected":false},"excerpt":{"rendered":"

By Orbex Consumer Confidence\u00a0continued to recover in August at a faster pace than economists had anticipated.\u00a0 It closed the gap from June\u2019s decline at 121.5 and improved the positive average. Expectations are for the CB\u2019s monthly index\u00a0to edge slightly higher in September.\u00a0 However, the\u00a0markets expect the numbers to uptick only 20 basis points above August\u2019s […]<\/p>\n","protected":false},"author":3,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[],"tags":[],"class_list":["post-156055","post","type-post","status-publish","format-standard","hentry","no-post-thumbnail"],"_links":{"self":[{"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/posts\/156055","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/users\/3"}],"replies":[{"embeddable":true,"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/comments?post=156055"}],"version-history":[{"count":2,"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/posts\/156055\/revisions"}],"predecessor-version":[{"id":156064,"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/posts\/156055\/revisions\/156064"}],"wp:attachment":[{"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/media?parent=156055"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/categories?post=156055"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/tags?post=156055"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}