The consumer confidence number bounced significantly. This is generally supposed to be positive to the currency, but because the US dollar has become a carry trade currency through the zero interest rate policy, now good economic news has an inverse effect on the US dollar, moving it lower.
It’s hard to believe that consumers are spending more money when their 401ks, house values and wages are down significantly, unemployment is rising and even if they are spending money retailers have marked down items so low their margins are razor thin.
The problem is that when there is bad macro news, such as the rumor of the US losing its AAA rating, the US dollar sinks, too. US equities can’t continue to rally if the currency continues to sink at this rate. All of the consumers will lose their purchasing power
