As far as economic reports go, Consumer Confidence (often lumped together psychologically with "Consumer Sentiment") occupies that well-populated "2nd tier" of reports that are more important than the non-market-movers but not quite on par with the mightier Nonfarm Payrolls or ISM releases (funnily enough, some consider ISM to be 2nd tier, but that's sheer silliness in light of recent reactions).

But is such a ranking justified for the Conference Board's Confidence data?

It would be easier to sort these reports out if we were dealing with FIVE metaphorical tiers as opposed to three.  That would go something like this:

  1. NFP
  2. The non-NFP stuff that still packs a punch (like ISM and ADP)
  3. Frequent but moderate market movers (Durable Goods, Jobless Claims, Confidence reports, some housing data, Chicago and Philadelphia regional reports)
  4. Infrequent or mild market movers (GDP, inflation data, Trade data, lesser industry-specific reports like Pending Home Sales or NAHB would be for the housing market)
  5. Reports that are safe to rule out at completely inconsequential

Even in that 5 tier breakdown, Consumer Confidence can, at times, vie for the 2nd tier as opposed to the 3rd depending on the day.  If it comes in stronger-than-expected, today could be one of those days.  We talked yesterday about how this set of data is one of the week's only offerings that, by it's nature, should be less affected by the weather. 

Today let's look at why we should care about this series in the first place.  Granted, the following charts examine the relationship of some parts of the Consumer Confidence data and the only partially useful unemployment rate (U/E) but U/E tends to broadly track other growth metrics in the economic data sphere.  In the charts, note that both headline Consumer Confidence and the employment specific "jobs-hard-to-get" component track with U/E quite well and tend to serve as early indicators.

2014-2-24 Consumer Confidence vs Unemployment

For those reasons and more, any significant departure from the 80.0 forecast could be today's most significant event and one of the first chances for bond markets to feel 'alive' in weeks.  An hour earlier, we'll get both the readings on Home Prices from Case Shiller and the FHFA.  These seldom move markets but are interesting nonetheless.  That's essentially it for scheduled data (apart from that tier 5 stuff which won't appear on our calendars).

If we're not seeing a more convicted move in MBS and/or Treasuries after the morning data (and that's a distinct possibility), then the default backup plan until further notice is the very boring task of patrolling the sideways consolidation in rates, roughly defined in the following chart of 10yr yields.

2014-2-24 Treasury Triangle

MBS Pricing Snapshot
Pricing shown below is delayed, please note the timestamp at the bottom. Real time pricing is available via MBS Live.
FNMA 3.0
96-17 : +0-00
FNMA 3.5
100-25 : +0-00
FNMA 4.0
104-07 : +0-00
2 YR
0.3221 : -0.0039
10 YR
2.7373 : -0.0127
30 YR
3.6925 : -0.0195
Pricing as of 2/25/14 8:00AMEST