The Dollar has appreciated slightly against Sterling, the Euro and Australian Dollar but is broadly flat versus the Swiss Franc and Kiwi Dollar in the past 48 hours. Retail sales in New Zealand surged 1.6% qoq in Q3, far more than expected (+0.2%), which appears to have put a floor under the Kiwi Dollar for now.
The US trade deficit was smaller than expected in October at $66.5bn – the narrowest goods deficit since June 2018 – which will have been music to President Trump’s ears. However, of more concern, is the ongoing fall in US consumer confidence and its likely impact on consumer spending. According to the Conference Board the consumer confidence index fell for the fourth consecutive month to 125.5 in November from 126.1 in October. US consumer confidence remains high in absolute terms but its steady erosion is likely to weigh on consumer demand, the main engine of US economic growth.
