ICM: Dollar Index Rebounds on Stronger Consumer Confidence

ICM, the leading London-based FX and CFDs provider, reported that the greenback bounced off the lows supported by better than expected consumer confidence.

The dollar index which measures the greenback against a basket of major currencies dropped to a four-week low of 94.43 on Tuesday, weighed down by investor’s risk appetite. However, DXY rebounded from the lows as the CB consumer confidence jumped to an eighteen-year high of 133.4. ICM highlighted in its report yesterday that the consumer confidence is crucial as it provides hints on the consumer spending which affects the overall economic activity. The second reading of the United States second-quarter GDP is due today. The dollar has been on the back foot since Powell’s Jackson Hole speech, but strong Consumer confidence and better-than-expected GDP reading could provide some support to the dollar.

On the other hand, SPX500 and Nasdaq traded at a record high supported by stronger consumer confidence and fewer trade tensions. As per ICM trading platform, the Dow Jones Industrial Average settled at 26064, the SPX500 closed at a record of 2897, and the Nasdaq Composite finished at a record close of 8030. US indices remain exposed to the GDP reading and developments in trade talks. The United States and Canada will start “serious” trade talks today which could lead to a trade deal.

Gold prices tumbled from a multi-week high of $1214 to trade at a low of $1199 post the release of the consumer confidence numbers. The economic indicators continue to prove that the United States economy is robust which supports the gradual rate hikes by the Federal Reserve. On the other hand, Silver ounce tumbled from a two-week high of $14.99 to settle at a low of $14.67.

Oil prices ended lower on Tuesday, pulled down by U.S. crude inventories. The American Petroleum Institute reported a rise of 38000 barrels to a total of 405.7 million barrels. As per ICM trading platform, the West Texas Intermediate crude futures settled lower at $68.50 per barrel, and the Brent futures fell from a six-week high of $76.94 to close at $75.86 per barrel. The Energy Information Administration will report the official crude inventories data today.

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