The shockingly deep decline in the US consumer confidence index has stalled the abortive equity rebound that greeted the US equity market this morning. After opening up 4%, stocks have lost about 3/4 of their early gains. EUR/JPY has succumbed to heavy profit-taking, falling back to 118.60 from 120.25 just ahead of the data.
Oftentimes consumer sentiment does not correlate closely with consumer behavior but there fear is with housing and stock prices both falling and unemployment rising, US consumers (and consumers in all the big economies) will keep their wallets deeply buried in their pockets in the months ahead.
