Consumer Sentiment Reports
The forex market attempts to interpret future consumer activity (i.e. spending) depending on consumer sentiment. The idea being that if consumers feel good they spend more and if they feel bad they will spend less.
It’s all a bit subjective and consumer sentiment is more often impacted by the price of fuel or the stock market, etc.
What makes consumers feel good or bad is usually directly related to average earnings and employment prospects and therefore personal income figures and personal spending figures are more relevant to the forex trader.
Personal income figures can be seen as a leading indicator to personal spending and the greater the increase in income the more optimistic the spending outlook will be and vice-versa.
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