Orders of durable goods rose by 1.3% in November, lower than 2% expected. Looking at core orders, we already have an outright drop of 0.1% against a rise that was expected. A deeper dive into the core of the core points to a drop of 0.1% as well.
Sales of durable goods feed into GDP and represent the long-term investment in the US economy, something that is of interest to the Federal Reserve.
A separate report showed that the Fed’s favorite measure of inflation came out at 0.1% m/m and 1.5% y/y. This was not a surprise but at least it is above the previous level of 1.4% y/y. Reaching the holy grail of 2% seems a bit far out at the moment. We already know that inflation is not going anywhere fast.
That report also showed that personal spending is up 0.6% in November, slightly beating expectations for 0.6%. Personal income, on the other hand, rose by only 0.3% instead of 0.4% predicted.
The US dollar mostly ignored the data.
- EUR/USD is slightly lower on the day, trading around 1.1854, but not really reacting to the news.
- USD/JPY is stable at 113.38.
- GBP/USD is slightly higher, at 1.3387, mostly thanks to a small upgrade in UK GDP: 1.7% y/y.
- USD/CAD is around 1.2766, but that is more of a reaction to Canada’s unimpressive GDP.
- AUD/USD is grinding higher to 0.7715.