Data released yesterday from the United States showed the clear dichotomy of the economy after new home sales reached the highest levels since 2008, driven primarily by the 87% rise in sales in the Northeast. However, a look outside the housing economy shows substantial weakness after yesterday’s manufacturing PMI dropped to the weakest level since 2013. Adding to injury was the slump in durable goods orders with the figures missing expectations across the board. While the core figure managed to rise to 0.50%, the regular figure plunged below the prior number, dropping -1.80% with May’s figure revised lower to -1.50%. The aberration in data due to the bounce in April indicates that a correction downwards remains intact and unlikely to abate. The dollar gained broadly over the session as FOMC voting member Jerome Powell put the probability of a September interest rate hike at 50%.
US Fundamentals Diverge
Daily Analysis - 24/06/2015