By Christopher Vecchio, Currency Analyst Are higher gas prices agitating consumers? Possibly, but the effect appears to be minimal. Despite $4/gallon gas across the United States, consumers remain nearly as optimistic as they ever have over the past year. The March consumer confidence reading came in at 70.2, slightly worse than the revised 71.6 reading in February. According to a Bloomberg News survey, the consensus estimate was for a reading of 70.0. If gas prices soften, consumer confidence could rebound in the coming months. The U.S. economy is currently in the midst of its best six-months of jobs growth since 2006 and the unemployment rate is now at its lowest level in three-years. U.S. growth has been robust relative to other major economies, with the final fourth quarter print due Thursday forecasted to confirm a growth rate of 3.0 percent from October through December. AUDUSD 1 -min Chart: March 27, 2012 Charts Created using Marketscope – Prepared by Christopher Vecchio Following the release, the markets at first bid up higher yielding currencies and risk-correlated assets, but ultimately, the U.S. Dollar prevailed. Already the top performing currency on the day, the Dow Jones FXCM Dollar Index (Ticker: USDOLLAR ) moved to fresh daily highs as the Australian Dollar and the Euro came under pressure. At the time this report was written, the AUDUSD had fallen from 1.0502 ahead of the release to 1.0485, a new low for the day. It is worth noting that Federal Reserve Chairman Ben Bernanke is due to speak at 16:45 GMT today as part of his college lecture series. While the first two segments were more-or-less history lessons on the Fed, the chairman is expected to discuss recent Fed policy decisions which could shed some light on whether or not there will be additional stimulus in the coming months. Just yesterday, Chairman Bernanke’s speech illuminated the Fed’s willingness to embark on another massive balance sheet expansion should the labor market struggle to improve further in coming months. --- Written by Christopher Vecchio, Currency Analyst , and Tzu-Wen Chen, DailyFX Research To cont act Christopher Vecchio, e-mail firstname.lastname@example.org Follow him on Twitter at @CVecchioFX To be added to Christopher’s e-mail distribution list, send an e-mail with subject line "Distribution List" to email@example.com .
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