The markets move exclusively on currency moves. The lack of market receptiveness of economic data shows that we are in some sort of irrational mode again.
Data yesterday was mixed but with small deviations from the expected values. Empire state manufacturing survey general business conditions index was a positive surprise of the day and was reported at 24.92 vs. 18.0 consensus and 15.92 prior reading. Treasury international capital flow somewhat surprised with China treasury securities holdings declining below Japanese ones, but apparently this was a result of security expiration . China was a net buyer in December and expiration give China an additional firepower for future purchases.
Housing market index rose to 17 in February, the reading in January was 15. Press release (delusional optimistic).No change in essence.
Chart 1. Housing Market Index (HMI) and The Three Components: 1995-Present SA
Source: NAHB/Wells Fargo Housing Market Index
ABC News Consumer Comfort Index was a negative surprise of the day. ABC News story: Consumer Confidence Near Low Point, With Little Optimism About Economy.
Consumer confidence is on a cold streak, locked in place since the beginning of the year at very near its worst-ever rating – and more than three in four think the economy is stalled or will decline in coming months.
The ABC News Consumer Comfort Index stands at -49 on its scale of +100 to -100, in a 2-point range and without significant movement for the past six weeks. It is hovering just 5 points from its all-time low, -54 last January, and is far worse than its long-term average, -13 in 24 years of weekly polls.
In U.K. we had two big developments today. First…the BOE ended the QE with a 9:0 vote at Februaray 2-3 meeting. Telegraph story: Bank of England rate setters voted 9-0 to halt quantitative easing. And unemployment claims rose. Bloomberg story: U.K. Unemployment Claims Jump to Highest Since 1997. Time ticking to the QE 2.0.