U.S. Factory Orders Unexpectedly Declined in June; USD Mixed
THE TAKEAWAY: [U.S. factory orders unexpectedly fell in June] > [Demand likely to remain weak amid slowing global economies and shrinking manufacturing activity] > [USDCAD mixed]
New orders for U.S. factory goods unexpectedly declined in June, reflecting cooling demand amid a slowdown in global economies. According to the U.S. Department of Commerce, orders to U.S. factories fell 0.5 percent in June, reversing the 0.5 percent gain in May that was downwardly revised from 0.7 percent initially reported. Bookings have declined in three of the last four months. The median forecast of 54 economists surveyed by Bloomberg News had called for a 0.5 percent increase in bookings in June. Orders for durable items climbed 1.3 percent in June, while bookings for non-durable goods slumped 2 percent, the largest decline since March 2009.
Yesterday’s purchasing managers’ report showed that manufacturing activity unexpected contracted in July, which indicates that we may expect to see ongoing weak demand for factory goods in July. The industry faces headwinds, as the slowing global economy continues to dampen demand for U.S. goods and weaken business conditions.
USDCAD 1-minute Chart: August 2, 2012
Chart created using Market Scope – Prepared by Tzu-Wen Chen
In the initial minutes after release of the factory order data, the greenback rallied against the Canadian dollar before quickly retracing to pre-data levels. At the time this report was written, the USDCAD pair remained little changed at C$1.0034.
--- Written by Tzu-Wen Chen, DailyFX Research
DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.