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11 Sep 2015
Fed's doves fueled by Michigan sentiment - ING
FXStreet (Guatemala) - Rob Carnell, analyst at ING explained that the sentiment pendulum has swung again, with preliminary September Michigan consumer confidence dropping from 91.9 to 85.7.
Key Quotes:
"This is perhaps not too surprising given what equity markets were doing during the period when this survey was taken (falling heavily), so rather than evidence of some structural decline, this might be viewed more as a reflection of the wild swings in market sentiment over recent weeks, and how these are feeding back into the real economy.
This conclusion is supported by part of the survey dealing with household finances, which shows a marked decline in assets.
At the margin, this release is further support for the Fed’s doves, but there is still industrial production and retail sales to come before the FOMC meeting on September 17, as well as CPI. The outcome of this Fed meeting still hangs perilously in the balance, with more swings in sentiment, not least of FOMC voters, likely before we get there."
Key Quotes:
"This is perhaps not too surprising given what equity markets were doing during the period when this survey was taken (falling heavily), so rather than evidence of some structural decline, this might be viewed more as a reflection of the wild swings in market sentiment over recent weeks, and how these are feeding back into the real economy.
This conclusion is supported by part of the survey dealing with household finances, which shows a marked decline in assets.
At the margin, this release is further support for the Fed’s doves, but there is still industrial production and retail sales to come before the FOMC meeting on September 17, as well as CPI. The outcome of this Fed meeting still hangs perilously in the balance, with more swings in sentiment, not least of FOMC voters, likely before we get there."