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US durable goods orders overview

The US Census Bureau is scheduled to release monthly durable goods orders data at 1230 GMT this Thursday and consensus estimates point to a strong growth of 3.0% m/m in June.  

Meanwhile, excluding transportation items, core durable goods orders, which tend to have a broader impact than the volatile headline figures, are anticipated to have risen by 0.5% during the reported period.  

Implication on the US Dollar (DXY)

Ahead of the key release, the greenback, as measured by the US Dollar Index (DXY) has managed to bounce of two-week lows and is now placed just above the 94.00 handle. A stronger than expected reading might raise expectations for a faster pace of Fed rate hike moves and provide an additional boost to the buck.  

Any subsequent up-move now seems to confront resistance near 94.30 area (55-day SMA), above which the momentum could further get extended towards 94.55-60 area (21-day SMA) en-route Tuesday’s swing high level of 94.85.

Alternatively, a softer data would do the opposite and drag the index back towards monthly lows support near mid-93.00s (set on July 9) with some intermediate support near the 93.75 region.

Key Notes

   “¢    Durable Goods Orders Preview: Trump’s leak lifts expectations

   “¢    US: Focus on durable goods order and advance goods trade report – TDS

About US durable goods orders

The Durable Goods Orders, released by the US Census Bureau, measures the cost of orders received by manufacturers for durable goods, which means goods planned to last for three years or more, such as motor vehicles and appliances. As those durable products often involve large investments they are sensitive to the US economic situation. The final figure shows the state of US production activity. Generally speaking, a high reading is bullish for the USD.