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April 24 – A survey released Friday showed that U.S. consumer confidence fell to its lowest level in nearly four years in April, impacted by inflation concerns stemming from the escalating conflict with Iran. The University of Michigans Consumer Survey Center reported a final reading of 49.8 for the month, the lowest level since June 2022. However, this figure is a slight improvement from 47.6 reported earlier this month. The index was 53.3 in March. "Consumer confidence has recovered some of the losses from the beginning of the month after the announcement of a two-week ceasefire and a slight drop in gasoline prices," said Joanne Hsu, director of the Consumer Survey Center. "The conflict with Iran appears to be primarily affecting consumer sentiment by impacting gasoline prices and other potential prices. In contrast, military and diplomatic developments that fail to ease supply constraints or lower energy prices are unlikely to boost consumer confidence."Following Washington, D.C. Attorney General Piros announcement that the investigation into Powell was halted, federal funds rate swap pricing indicated that expectations for a Federal Reserve rate cut this year have further intensified.U.S. Treasury Secretary Bessenter: The dollars dominance and reserve currency status have been further strengthened.U.S. Attorney for the District of Columbia, Piro, said: "If necessary, we will not hesitate to reopen the investigation into Federal Reserve Chairman Powell."U.S. Attorney for the District of Columbia, Robert Piro, announced the suspension of the investigation into Federal Reserve Chairman Jerome Powells construction costs. The Federal Reserve Inspector General has been asked to review the Feds spending.

With positive market sentiment, GBP/USD targets momentum above 1.1360; the UK CPI is the main topic

Daniel Rogers

Oct 19, 2022 15:46

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The GBP/USD pair is hitting resistance near the immediate barrier of 1.1360 during the Tokyo session. The barriers surrounding 1.1360 seem to be thinning as market participants' risk tolerance increases. After two straight strong trading days, S&P500 futures have continued to increase their gains in the Tokyo session. After overcoming the aforementioned challenge, the pound bulls will grow stronger.

 

The US dollar index (DXY), which is now doing poorly, is circling about 112.00. The value of the asset can drop even further as a result of a decline in the demand for safe-haven assets. In contrast, despite the Fed's heightened hawkishness, US bond returns continue to be strong. The 10-year US Treasury yields have advanced over 4.01% as of the time of writing.

 

The likelihood of a fourth consecutive 75 basis point (bps) rate increase announcement is roughly 96%, according to the CME FedWatch tool.

 

According to Reuters, Neel Kashkari, president of the Minneapolis Fed Bank, said on Tuesday in response to escalating inflationary pressures, "Until I see some compelling indication that core inflation has at least peaked, I am not willing to pronounce a pause in rate hikes."

 

The rate of inflation hasn't changed much as a result of ongoing Fed rate rises. Although the core Consumer Price Index (CPI) is well-anchored due to rising service sector pricing, the headline CPI has declined as a result of decreasing fuel prices.

 

On the British front, the Bank of England (BOE) announced on November 1 that the Asset Purchase Facility will include its bond-selling program (APF). Market liquidity will decrease as a result.

 

In the UK, political unrest is at an all-time high as a result of the government's lack of confidence in Prime Minister Liz Truss. If given the opportunity to vote again, Rishi Sunak, who lost to Ms. Truss, would receive 55% of the Tory members' votes, while Ms. Truss would receive only 25%.

 

Future course will depend on the inflation figures released by the United Kingdom on Wednesday. Forecasts suggest that the headline and core inflation rates could both rise by 10 basis points, to 10% and 6.4%, respectively. An increase in inflation reaching double digits could pose new challenges for the British economy.

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