Skip to Content
News & Analysis at your fingertips.

We use a range of cookies to give you the best possible browsing experience. By continuing to use this website, you agree to our use of cookies.
You can learn more about our cookie policy here, or by following the link at the bottom of any page on our site. See our updated Privacy Policy here.

Free Trading Guides
Subscribe
Please try again
Select

Live Webinar Events

0

Economic Calendar Events

0

Notify me about

Live Webinar Events
Economic Calendar Events

H

High

M

Medium

L

Low
More View More
USD Breaking News: US Dollar Index (DXY) Retreats as Durable Goods Data Disappoints

USD Breaking News: US Dollar Index (DXY) Retreats as Durable Goods Data Disappoints

What's on this page

US DOLLAR, DURABLE GOODS KEY POINTS:

  • US Core Durable Goods Actual 0.7% Vs Forecast 0.2%.
  • US Durable Goods Actual -4.5% Vs Forecast -4%.
  • Durable Goods Orders Ex Transp MoM(JAN) Actual 0.7% Vs Forecast 0%.
USD Forecast
USD Forecast
Recommended by Zain Vawda
Get Your Free USD Forecast
Get My Guide

MOST READ: US Dollar (DXY) Technical Forecast: Bullish Dollar Index Facing Technical Challenges in the Week Ahead

US durable goods data for January came in below expectations on a MoM basis, with a print of -4.5% (down in 2 of the last 3 months). The number was weighed down by a sharp decline in orders for transportation equipment 13.3%, namely orders for nondefense aircraft and parts (-54.6%).

Durable goods ex. transportation was 0.7%, beating Wall Street estimates by quite a distance. We also had declines in capital goods while orders for machinery, computer and electronic parts increased by 1.6% and 0.5% respectively. Orders for non-defense capital goods excluding aircraft, a closely watched proxy for business spending plans, increased 0.8%, reversing from a 0.3% fall in December.

image1.png

Customize and filter live economic data via our DailyFX economic calendar

US DATA MOVING FORWARD

The US economy over the month of February has gone from strength to strength, defying expectations at every turn. Friday’s PCE data has stoked fears that inflationary pressures may be more stubborn than market participants had hoped. The month of February saw the Fed Funds peak rate expectations for 2023 rise from 4.8% to 5.4% with Federal Reserve policymakers keen to emphasize the need for further hikes in recent comments. Looking ahead it will be interesting to see what effect the recent batch of data has had on the Fed dot plots which will be released at its upcoming meeting on March 22.

Trade Smarter - Sign up for the DailyFX Newsletter

Receive timely and compelling market commentary from the DailyFX team

Subscribe to Newsletter

We might not have NFP jobs data to look forward to this week, but we do have ISM data which could be key. Given the positive data out during January which many attributed to the festive season and improved weather market participants will be keeping a close eye for a continued improvement. Given that the US is predominantly a service driven economy the ISM Non-Manufacturing PMI will be of particular importance with forecast sitting at 54.5 slightly down from last month's 55.2 print. A better than expected showing here could likely set the tone and fuel optimism that March data will remain strong.

MARKET REACTION

Following the data release the dollar index declined from 105.10 to 104.95 with immediate support on the H1 chart resting at 104.88.

The dollar index has been on tear since printing its YTD low around the 100.80 mark reached on February 2. Looking at the bigger picture the index is mixed as we had such a bullish weekly and daily candle close this past Friday, yet the RSI is in overbought territory. Also, the fact that we have just posted our fourth week of gains (which we have not seen since October 2022) leads me to believe that we could be in for some form of retracement for the rest of the week.

Dollar Index H1 Chart- February 27, 2023

Chart, line chart  Description automatically generated

Source: TradingView, prepared by Zain Vawda

RESOURCES FOR FOREX TRADERS

Whether you are a new or experienced trader, we have several resources available to help you; indicators for tracking trader sentiment, quarterly trading forecasts, analytical and educational webinars held daily, trading guides to help you improve trading performance, and one specifically for those who are new to forex.

--- Written by Zain Vawda for DailyFX.com

Contact and follow Zain on Twitter: @zvawda

DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.

DISCLOSURES