The dollar is back on a downward trend, breaking new lows: the euro has gained +0.3% and is back at $1.1190, posting its best close since July 19, 2023.
The $-Index (-0.3% at 100.55) is clearly threatening the 100.70/100.65 level this evening (the low reached at the end of 2023 has been breached), 48 hours after Powell’s speech confirming the start of a rate cut, a scenario which has been hoped for without hesitation since the end of October 2023.
The greenback drew no support from the unexpected rise in consumer confidence in the United States: it unexpectedly improved in August despite rising concerns about the labor market, the Conference Board’s monthly survey showed on Tuesday.
The index came in at 103.3 this month, compared with a revised figure of 101.9 in July, while economists were on average expecting a slight dip to around 101.
The consumer assessment of the current situation component rose to 134.4, after 133.1 last month, while the expectations component advanced to 82.5, compared with 81.1 in July.
In a press release, the ConfBoard notes that this is the second month in a row that the latter has exceeded the 80-point mark, a level below which a recession is generally in the making.
Few figures and a gloomy mood in Europe, with Germany’s GDP down by 0.1% in Q2 2024, according to Destatis volume and CVS-CJO data, which confirms its initial estimate of July 30 in a second reading.
This would have been much worse without state orders and the inclusion of ‘inventory effects’… but it was a figure of no consequence for the Euro.
Sterling appreciated +0.6% against the Dollar and +0.3% against the Euro (to 0.8435) after Keir Starmer presented a draft austerity budget for 2025, which was “painful” for his fellow citizens.
This morning, we discovered that Germany’s GDP fell by 0.1% in the second quarter of 2024 compared with the first, according to volume and CVS-CJO data from Destatis, which thus confirms in a second reading its initial estimate of July 30.
The situation would have been much worse had it not been for government orders and ‘inventory effects’.
Lastly, the ounce of gold held steady at $2,512, despite the clear tension in rates on the day, the ‘weak dollar’ factor having been preponderant.
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