Mediocre Durable Goods Orders Send Dollar Down
Headline durable goods orders rose by 1.8% in January, better than 1.6% expected, but the rest looks much worse. Core orders dropped by 0.2% against a projected rise of 0.5%. The upwards revision for December, from 0.5% to 0.9%, was quite unhelpful.
In addition, the ex defence and ex-air spending fell by 0.4%, also against 0.5% predicted. Yet again, the revision for December is not only stale but not enough to compensate.
Currencies were mixed in the initial reaction, but after the dust settled on the various slices and dices of the numbers, the US dollar began losing ground. While Q4 and 2016 may look better, the year is off to a weak start on the investment front.
- USD/JPY was rejected at the 112.50 resistance level and the pair is now at 112.25, the middle of the 112-112.50 range.
- EUR/USD, which is looking for a direction, now favors the higher end of the range and tops 1.06.
- GBP/USD is recovering from an initial dip on Brexit spillovers and is holding its ground above 1.2420.
- USD/CAD is around 1.31, sliding after previous gains.
- AUD/USD is at 0.7675, moving higher within the 0.76-0.77 range
- NZD/USD continues its quiet recovery, trading above 0.72.
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