Market Analysis by covering: . Read 's Market Analysis on Investing.com
Gold prices surge to new record high on haven demand; Fed decision ahead. On its face, the sharp drop raises questions about consumer spending in the months ahead. But until there’s confirmation in the hard data, it’s best to view the polling cautiously and look for supporting context in other numbers.
The surprise drop in the Consumer Confidence Index for this month could be an early warning for the economy, which is powered by consumer spending. But history suggests reserving judgment is sensible when you consider that the relationship between survey data and the economy is weak. It could be different this time, of course, but it’s too early to confidently make that call. Nonetheless, the latest results are worrisome. “Confidence collapsed in January, as consumer concerns about both the present situation and expectations for the future deepened,” said Dana Peterson, chief economist at The Conference Board. “All five components of the Index deteriorated, driving the overall Index to its lowest level since May 2014 — surpassing its COVID-19 pandemic depths.” To gauge if CCI is noise or signal for the near term, it’s essential to look for confirmation in other data sets, and on that point, the numbers from elsewhere still leave plenty of room for debate. Let’s start with an alternative measure of the mood on Main Street via Consumer Sentiment Index: the University of Michigan’s polling also shows subdued sentiment in January, hovering near the lowest level since 2022.turned up this month. Here, too, there are concerning signs, but the latest reading suggests that not much changed this month vs. recent history. Turning to hard data on spending paints a brighter picture, albeit one based on lagging numbers due to the government shutdown. Looking through the short-term noise, the year-over-year change inIndex tracks same-store sales and the 7.1% year-over-year increase through Jan. 24 is in line with results over the past several months. Turning to the broader economic trend, the Dallas Fed’s Weekly Economic Index also points to comparable growth compared with recent history. Reporting on data through Jan. 17, WEI continues to print at 2%-plus reading, which is in line with the relatively solid 2.3% four-quarter GDP growth through third quarter 2025.Given the preponderance of relatively upbeat data beyond polling consumers, the hard numbers suggest we should be wary of reading too much in mood measures on Main Street for managing economic expectations. “Admittedly, the expectations index has greatly overstated the weakness in spending in recent quarters,” said Oliver Allen, senior U.S. economist at Pantheon Macroeconomics. “But we’d be surprised if its recent deterioration proves to be an entirely false signal, particularly given the recent stagnation in real incomes and the already rock-bottom personal saving rate.” Fair enough. But until the implied warnings in consumer surveys start resonating in other data sets, it’s still best to take a trust-but-verify approach to polling-based warnings.Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks. Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes.and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website. It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
United States Latest News, United States Headlines
Similar News:You can also read news stories similar to this one that we have collected from other news sources.
Here’s Why Gold Is Beating Bitcoin in a Weak-Dollar MarketAnalysts say a weak dollar only helps Bitcoin during easy liquidity or inflation, not during risk-off capital preservation.
Read more »
Beloved N.J. market closes permanently after failed revival of ‘cherished community institution’1663 Market, the gourmet food market that replaced the longstanding Sickles Market, closed on Jan. 18.
Read more »
Fed Decision Day: Pause Expected With Powell’s Tone in FocusMarket Analysis by covering: S&P 500, US Dollar Index Futures, Gold Futures, United States 10-Year. Read 's Market Analysis on Investing.com
Read more »
From Bank Bloodbath to Pipeline Boom: An 8.1% Yield Escape PlanMarket Analysis by covering: Alerian MLP ETF. Read 's Market Analysis on Investing.com
Read more »
Microsoft Earnings: High Capex Signals Confidence — Now the Numbers Must DeliverMarket Analysis by covering: Microsoft Corporation. Read 's Market Analysis on Investing.com
Read more »
US Dollar Supremacy Cracking as Investors Seek EscapeMarket Analysis by covering: US Dollar Index Futures. Read 's Market Analysis on Investing.com
Read more »