US CB Consumer Confidence Index rose to 91.8 in March
US consumer sentiment picked up marginal pace in March, as the Conference Board’s Consumer Confidence Index ticked a tad higher to 91.8 from February’s 91.0 (revised from 91.2).
  • US CB Consumer Confidence Index improves in March.
  • The US Dollar Index loses momentum, hovers around the 100.00 hurdle.

US consumer sentiment picked up marginal pace in March, as the Conference Board’s Consumer Confidence Index ticked a tad higher to 91.8 from February’s 91.0 (revised from 91.2).

“Consumer confidence ticked up again in March, as a modest improvement in consumers’ views of current conditions outweighed a slight downshift in expectations for the future”… “Three of five components of the Index firmed in March, and overall confidence improved modestly for a second month. Nonetheless, the Index has been on a general downward trend since 2021,”said Dana M Peterson, Chief Economist at The Conference Board.

Market reaction

The US Dollar (USD) reverses part of its recent multi-day rebound, motivating the US Dollar Index (DXY) to abandon the area of recent peaks near 100.60 and refocus on a potential test of the 100.00 support.

GDP FAQs

A country’s Gross Domestic Product (GDP) measures the rate of growth of its economy over a given period of time, usually a quarter. The most reliable figures are those that compare GDP to the previous quarter e.g Q2 of 2023 vs Q1 of 2023, or to the same period in the previous year, e.g Q2 of 2023 vs Q2 of 2022. Annualized quarterly GDP figures extrapolate the growth rate of the quarter as if it were constant for the rest of the year. These can be misleading, however, if temporary shocks impact growth in one quarter but are unlikely to last all year – such as happened in the first quarter of 2020 at the outbreak of the covid pandemic, when growth plummeted.

A higher GDP result is generally positive for a nation’s currency as it reflects a growing economy, which is more likely to produce goods and services that can be exported, as well as attracting higher foreign investment. By the same token, when GDP falls it is usually negative for the currency. When an economy grows people tend to spend more, which leads to inflation. The country’s central bank then has to put up interest rates to combat the inflation with the side effect of attracting more capital inflows from global investors, thus helping the local currency appreciate.

When an economy grows and GDP is rising, people tend to spend more which leads to inflation. The country’s central bank then has to put up interest rates to combat the inflation. Higher interest rates are negative for Gold because they increase the opportunity-cost of holding Gold versus placing the money in a cash deposit account. Therefore, a higher GDP growth rate is usually a bearish factor for Gold price.

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