Bullish USD Undermined by Shaky Durable Goods Orders
- Durable Goods Orders come in shy of analyst estimates at -18.2% m/m.
- Durables Ex Transportation comes in at +0.7% m/m ahead of estimates.
- Initial Jobless claims jump to 293K versus the 280K prior. Shaky
US Durable Goods Orders for August came in short of market estimates, with the headline reading slipping to -18.2% versus analyst estimates of -18.0% from the prior month, and the US Dollar is absorbing the weakness modestly. The print is a noticeably lower reading than the prior reading of +22.6%. A look at the core figures, Durables Ex Transportation August reading came in just above analyst estimates at 0.7%.
Why the wild figures? It’s important to note that the Durable Goods Orders were severely distorted due to a large July airshow order with Boeing Co.It’s not surprising then that market participants are paying more attention to the core figure.
Here’s a summary of the data this morning that’s put a halt on the US Dollar’s intraday rally:
- Durable Goods Orders (AUG): -18.2% versus -18.0% expected, from +22.5% (m/m).
- Durables ex Transports (AUG): +0.7% versus +0.6% expected, from -0.5% (m/m).
- Initial Jobless Claims (SEP 20): 293K versus 296K expected, from 281K.
- Continuing Claims (SEP 13): 2439K versus 2440K expected, from 2432K.
EURUSD 1-minute Chart: September 25, 2014 Intraday
Charts Created using Marketscope – prepared by Christopher Vecchio
Despite the limited market reaction to US Durable Goods data, it appears that EURUSD may continue its downward trend. After a small run to $1.2726 the pair began to trade sideways and can’t seem to manage a rally in what has been a relentless bearish trend. EURUSD has broken through several major Fib levels from the 2012 low to the 2013 high and may continue on towards $1.2500 over the coming weeks.
--- Written by Christopher Vecchio, Currency Strategist and Tyler Amend, DailyFX Research
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