Household HSBC Watch

We said for months that the UK is a bellweather for the United States. That is why this piece of logic is disturbing. UK consumer confidence stabilized this month after falling to a 12-year low during the crucial Christmas shopping period in December, figures showed today. Karen Ward, economist at HSBC, said the Bank’s monetary policy committee had until recently not paid much attention to consumer confidence. Really?

Alan Castle, economist at Lehman Brothers, had a more intelligent position concerning the drop in the major purchases index in the survey to its lowest since 1990. “Given that this component has had a relatively strong correlation with retail sales volumes historically, the January fall points to a deteriorating outlook for the retail sector, private consumption, and in turn, GDP growth,” he said.

HSBC needs to pay attention to consumer confidence in the United States, where HSBC Finance Corp, formerly Household International, has alienated and angered Americans from coast to coast.