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During the U.S. session on the Forex market the U.S. dollar strengthened against major currencies after strong data on orders for durable goods in the United States.
Orders for durable goods has increased markedly in the last month, beating forecasts with experts. Last improvement - a sign that increased investment in enterprises can contribute to U.S. economic growth in the second half of the year.
Ministry of Commerce announced that the seasonally adjusted demand for durable goods rose in June by 0.7%, which followed a 1.0% decline in the previous month (value was revised from -0.9%). Add that many experts had expected lower growth - 0.4%.
Orders for durable goods excluding transportation rose 0.8%, while the indicator calculated excluding the defense industry, increased by 0.7%.
We also learned that the leading indicator of business investment, which reflects the level of orders for non-defense capital goods excluding aircraft, rose in June by 1.4%.
Recall that orders for durable goods increased for four of the last five months. Given these changes, economists expect business investment to rise in the second quarter - after the economy shrank by 2.9% in the first quarter. Today's report also showed that factory shipments of durable goods rose 0.1% in June after declining in May by 0.1%, while the backlog of orders increased by 0.8% after a 0.7% gain. We add that the stocks of durable goods rose 0.4% in May after rising by 1%.
The euro exchange rate fell sharply earlier against the dollar was under pressure the German data. The findings, published institute Ifo, showed that the July level of business confidence in Germany fell again, thereby exceeded the forecasts of experts and fixing the third consecutive monthly deterioration. According to the report, the business climate index fell in July to a level of 108.0 points compared to 109.7 points last month, and economists' expectations at the level of 109.6 points. With regard to the current index, that he fell this month to the level of 112.9 points, which was also well below economists' expectations of 114.5 points. Recall that in June, the index stood at 114.8 points. We also learned that the expectations index deteriorated to 104.5 points, slightly exceeding the forecasts of experts 104.4 points. Last month, the value of this index was 104.8 points.
The pound fell against the U.S. currency, updating the yesterday's low. Influenced the course of trade data, which showed that in the second quarter gross domestic product of Britain increased by 0.8 percent, which was in accordance with the result of the first quarter and economists' expectations. Compared to the second quarter last year, the economy grew by 3.1 percent, the highest rates since late 2007. This means that overall economic growth was 0.2 percent more than in the first quarter of 2008, when it was recorded the previous peak. We add that the annual growth also coincided with the estimates of experts, and accelerated compared with the previous quarter - while GDP grew by 3.0 percent. The Office for National Statistics also reported that the head of the growth in the second quarter was again the service sector, which expanded by 1.0 percent compared with the previous three months, and fixing the fastest quarterly growth since the third quarter of 2012.
Demand for the yen was limited after the publication of weak report on exports from Japan and negative data on the consumer price index. Value measure of inflation, adjusted for the effect of increasing the sales tax was lower than in the previous reporting month: +1.6% in June against 1.7% in May.
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