Dollar bears bring out claws as confidence drops

US consumer confidence released by conference board registered sharp drop for July.

Dollar has taken an immediate hit over the release. Euro jumped by 30 pips to as high as 1.106 against dollar. Pound and Yen has given similar moves.

The Survey, is conducted for The Conference Board by Nielsen, a leading global provider of information and analytics. The cutoff date for the preliminary results was July 16.

Key highlights -

• The Index now stands at 90.9, down from 99.8 in June.
• The Present Situation Index decreased moderately from 110.3 last month to 107.4 in July.
• Expectations Index declined sharply to 79.9 from 92.8 in June.

Though overall, the Index remains associated with an expanding economy and a relatively confident consumer, concerns over FED hike, Chinese volatility and Crash in stock market and Greek debt crisis might have pulled confidence down.

Consumers' outlook for the labor market was less optimistic. Those anticipating more jobs in the months ahead decreased from 17.1 percent to 13.1 percent, while those anticipating fewer jobs increased from 15.2 percent to 20.0 percent.

Dollar is likely to shrug off this one bad data, however if consumer confidence starts deteriorating further in the coming months it might dent optimism over US economy.