• US durable goods orders contracted sharply in July
  • The 6.8% decline more than offsets the prior increase of 6.4%
  • USD little changed going into Yellen

A sharp drop of 6.8% in the most recent US durable goods orders data in month-on-month terms has more than offset the rise seen in the previous print of 6.4%. Such a huge variation for this release is quite rare but given the month-on-month nature it actually means that there’s been little change. Given that the prior month was revised lower by 0.1% also, the headline read is mildly negative but overall the trend remains fairly positive.

The core reading is often seen as a more accurate barometer and this appears to be the case here with a 0.5% m/m rise after a 0.1% increase seen last time out (revised lower from 0.2%). This is marginally better than the 0.4% expected and when placed in the context of the previous 4 releases having missed forecasts then this is a positive sign.

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 Both Durable goods orders and its core component remain in an uptrend in recent years. Source: XTB Macrobond

 The US dollar is trading in a typically small range ahead of Yellen. With the Fed chair set to begin her speech in less than an hour, only the cryptocurrencies and the HUF and RON are making any notable moves against the US dollar.

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 The US dollar is trading little changed against all of its major peers, with cryptocurrencies the biggest movers. Source: xStation