US Dollar Climbing After Unexpected Rise In Durable Goods Orders
Washington (Aug 26) The US dollar is rising against all of its major competitors Wednesday, extending its gains from the previous trading session. The currency is benefitting from the surprise increase in durable goods orders and comments from William Dudley .
New orders for US manufactured durable goods unexpectedly saw a notable increase in the month of July, according to a report released by the Commerce Department on Wednesday.
The Commerce Department said durable goods orders climbed by 2.0% in July after jumping by an upwardly revised 4.1% in June. The continued increase surprised economists, who had expected orders to drop by 0.4%.
Investors will be watching for the release of the preliminary reading on second quarter GDP on Thursday, as well as weekly jobless claims data.
The Federal Reserve may delay hiking interest rates until at least December. The case for a rate hike in September is "less compelling" given problems with the global economy and plunging stocks, said William Dudley , the president of the New York Fed, on Wednesday.
"From my perspective, at this moment, the decision to begin the normalization process at the September FOMC meeting seems less compelling to me than it was a few weeks ago," he said.
"But normalization could become more compelling by the time of the meeting as we get additional information on how the US economy is performing and more information on international and financial market developments, all of which are important in shaping the US economic outlook," he added.
European Central Bank Executive Board member Peter Praet said downside risks to inflation have increased and the bank is willing to expand its bond purchase program if needed.
"Developments in the world economy and commodity markets have increased the downside risk to achieving the sustainable inflation path towards 2%," he told reporters on Wednesday.
"There should be no ambiguity on the willingness and ability of the governing council to act if needed," he added.
The dollar has risen to around USD1.1365 against the Euro Wednesday afternoon, from a 7-month low of USD1.1713 on Monday.
The buck has climbed to over a 2-week high of around USD1.5475 this afternoon, from yesterday's 2-month low of USD1.5817 .
British retail sales growth improved unexpectedly in August, survey data from the Confederation of British Industry revealed Wednesday. The balance of the CBI's distributive trades survey rose to +24 in August from +21 in the previous month. Economists had expected a balance of +18.
UK mortgage approvals rose for a seventh month in a row in July to their highest level in seventeen months, in line with economists' expectations, figures from the British Bankers' Association showed Wednesday.
The seasonally adjusted number of mortgage approvals for house purchased climbed to 46,033 from 44,802 in June, which was revised from 44,488. Economists had forecast 46,000 approvals for July.
The greenback has risen to around Y119.625 against the Japanese Yen this afternoon, from Monday's 7-month low of Y116.127 .
Corporate service prices in Japan were up 0.6% on year in July, the Bank of Japan said on Wednesday. That beat forecasts for an increase of 0.4%, which would have been unchanged from the June reading.
Source: AllianceNews
