U.S consumer confidence improves in February but falls shy of the analysts’ estimate

The recent outbreak of Coronavirus in China has weighed on the global financial markets. The U.S economy was previously anticipated to take a significant hit as business operations remained disrupted in the largest Asian economy.

Amidst the negative outlook, the Conference Board released its U.S consumer confidence report for February on Tuesday. The data suggested that consumer confidence improved this month in the United States and hinted at a relatively stable rate of consumer spending that may be sufficient to offer the required support to the U.S economy.

Conference Board Recorded The Consumer Confidence Index At 130.7 In February

The Conference Board recorded the consumer confidence index at 130.7 in February. January’s reading was also downwardly revised to post at 130.4. The previous reading for January was at a much higher 131.6. While February’s figure suggested improvement in the index in February as compared to January’s revised data, it fell significantly shy of the analysts’ estimate who expected the index to register at 132.0 in February.  

The present situation sub-index that is primarily driven from the consumer’s assessment of the labor market and business conditions (current) dropped sharply in February to 165.1 In January, the figure was recorded at a much higher 173.9. The expectations sub-index, on the other hand, that is based on consumers’ outlook (short-term) of the labor market, business conditions, and income, saw an increase in February.

Tuesday’s data was reported in line with the IHS Markit’s flash composite PMI output index that was announced last week on Friday. The composite PMI that offers valuable insight into the services as well as the manufacturing sector of the United States, declined into the contraction zone in February to print its worst reading in 76 months. IHS Markit had attributed the decline to the health emergency in China that is sabotaging the travel/tourism industry while disrupting business operations as well.

EUR/USD Climbed To 1.0890 On Tuesday From A Daily Low Of 1.0830

The CB consumer confidence was expected to be the major market mover for EUR/USD in the forex market. Having missed the analysts’ optimistic estimate, the economic data wasn’t well-received by the U.S dollar index that lost traction to fuel EUR/USD to as high as 1.0890 level from a daily low of 1.0830.

EUR/USD is currently exchanging hands at 1.0882. Trading below the crucial 1.09 resistance, the pair still has a bearish pattern. A daily close above 1.09 level is required to threaten the current bearish trend in EUR/USD.