Pound to US Dollar (GBP/USD) Exchange Rate firms on mixed US data

The US Dollar was little changed against the Pound and Euro on Friday as positive consumer spending and personal income data was countered by a negative consumer sentiment report.

The Commerce Department released data which showed that consumer spending increased by 0.3% last month personal income also rose by 0.3%. The spending figure was in line with economist predictions and was the biggest rise in three months. Income rose by the same margin recorded in the first month of the year, suggesting that momentum is returning to the US economy after the harsh winter period.

Another report showed that there were few inflationary pressures in February as a consumer price index edged higher by 0.1% for a second consecutive month. Prices in February rose 0.9 percent from a year ago, compared to a 1.2 percent advance in January over the previous 12 months. February’s increase was the smallest since October.

Countering that data however was the release of a consumer sentiment report which showed that consumer optimism over the health of the US economy fell in March.

The Thomson Reuters/University of Michigan’s consumer sentiment index came in at 80, down from February’s figure of 81.6.

“Current conditions in the overall economy were reported by consumers to have recently weakened, and long term prospects for the economy softened,” said survey director Richard Curtin.

Next week promises to be a fairly volatile one for the ‘Greenback’ due to the release of a plethora of economic data releases. The US will see the release of the latest ISM manufacturing, Adp Employment change and balance of trade data.