Yellen sent the dollar down
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The profusion of orders for durable goods declined in July to 6.8%, the biggest retire from in the last 3 years, the positive effect of the growth +6.4% a month earlier fully expiate for. Sharp drop in orders caused, in the first place, it is extremely insubstantial report Boeing, which reported a total of 22 new aircraft against 184 in the preceding month, overall orders for the goods transport sector decreased by 19%.
At the equable so time, the volume of orders excluding transportation components and military matriel developed by 0.4%, indicating that even weak, but the growth of investment in industrial output. Weak report on orders added pessimism USD bulls, but the market on the occurrence of the release almost did not react – the players were in expectation of the speech of Janet Yellen in Jackson ravenous. The fed in its rather laconic speech gave an assessment of the economic situation in the domain and the world, however, skillfully avoided discussing monetary issues of support, while the audience was waiting for news on this issue. Yellen has pinpointed on the regulatory publishes in the post-crisis period, noting the increased stability of the monetary system that chanced not at the expense of economic growth, and expressed self-reliance that future shifts should also be moderate. Passivity Yellen, merchandises clearly did not identical to, and the players reacted with a massive dollar sell-off. Apparently, investors undisputed that more decisive action, the time has not yet succeed, and to flee to dollar assets too antiquated. The yield on 10-year Treasury checks decreased in the time to 2.162%, that is, to two-month stifles, the S&P 500 pointer closed the week slightly higher, which hints lower conviction in the dollar, but the dynamics of the futures rate, according to the CME, indicating a 42% turn to see the growth rate for the year, which can be regarded as a disinterested response. The upcoming week resolution be rich on the publication of important macroeconomic evidence and political news. Every day the Congress insignificant time for consideration of a extend of important issues, such as the adoption of the budget for the new financial year, commerce of the current activities of the government (the notorious question of the in arrears ceiling), Obamacare and tax modification, the adoption of which, obviously, will be missing significant changes in economic legislation. Wednesday you need to pay attention to the ADP report in investigate on employment in the GI Joe sector. The number of employees increased continuously for 82 consecutive months, the growth of June 178 thousand was slightly below forecasts, it is likely that July thirst for be a little better. Also on Wednesday will be published the second guesswork for GDP growth rates, significant changes in any direction are unlikely. Thursday – the monthly of the despatch on personal spending and incomes in July and the price index of the PCE, sending inflationary mutates in the consumer sector. Markets expect growth after CPI figures disenthral is worse than expected is able to support the dollar.
The key happening of the week is the utilization report on Friday. The markets are waiting for the continuation of truculently growth in the covey of new jobs and reduce unemployment, however, there are dangerous concerns that the development in average wages will be low, which could part to another quiver of sales of dollar. Also on Friday we will see the ISM pointer in the manufacturing sector, without thought a slight slowdown, the index holds not quite three-year high, over the high level of optimism of investors. And so, the markets greeted the new week in a maintain of disorientation. Yellen gave no new conduct, but because the start of the program, pulp the balance in September is once again underneath question. The growth of federal risks and upcoming trouble in Congress interesnoye raise mood, which may sequel in a further decline in the dollar index and the spread in demand for the Euro, the yen, and partly on gold.