The US consumer Index has fallen and existing housing sales data have shown a dip. This has led to expectations building up for another Fed Rate cut, reports CNBC-TV18.

Analysts said that it was surprising how the US markets closed flattish yesterday, as there was a bout of negative data. It started with the Consumer Index, which was at 99.8 versus an estimation of 104.3. It is the lowest since the last couple of years.

The index is low because of three factors: people are realizing that net worth has decreased because of a decline in housing prices, there is a sense of deteriorating labour market and it is getting very difficult to get credit in the market.

Some analysts believe that the circumstances might not be as good as was expected. The Consumer Index adds up to about two thirds of the GDP. So, it is expected that the GDP would also reduce, if the consumer index goes down.