Upside Surprise in Confidence?
At 10:00 AM EST on Tuesday, March 30th, the Conference Board (CB) releases its monthly Consumer Confidence figures.
The Conference Board surveys 5000 American households with questions pertaining to economic conditions, business climate, and labor availability. The answers are converted into a composite index that creates the headline Consumer Confidence figure. The theory for Forex traders is that rising consumer confidence triggers spending which in turn lifts the currency. If the figure beats the estimate, it is considered bullish for the US dollar. Missing the forecast is thought to be a bearish signal.
To give you some perspective on this figure, in June 2007, almost 3 years ago, it was 103.9. Today, it is forecast to be 50.01. The figure is tied to the employment situation. Most pundits believe that employment is slowly improving. I believe the estimate of 50.01 is low and expect an upside surprise.
David Goodboy is Vice President of Business Development for a New York City based multi-strategy fund.
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