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U.S. GDP, Jobless Claims, Durable Goods Orders, Pending Home Sales

calendar 27/06/2024 - 07:46 UTC

The U.S. dollar posted another moderate increase against most major currencies on Wednesday, with the dollar index (USDX) sitting close to a near two-month high, ending the session up by 0.42%. Market focus is squarely on PCE price index data, the Federal Reserve’s preferred inflation gauge, as well as the first Presidential debate, which is set to take place later on Thursday.

In other news, the dollar breached the 160.0 mark against the yen in overnight trading, something which traders had pegged as the threshold for more government intervention. These price levels had invited government intervention in May, where the government sold large amounts of dollars to buy up yen and support the currency. Uncertainty surrounding U.S. interest rates and worries about China's weak economic data dampened sentiment in Asian markets.

According to widely cited CME Fedwatch tool, a September rate cut is the most likely scenario with chances at nearly 60% while for November, the possibility stands at around 50%.

Wall Street closed with cautious optimism Wednesday, buoyed by the tech sector's rise ahead of crucial inflation data. Amazon's move higher, further fueled the positive sentiment as the company’s stock closed at record highs after gaining 4% on the day, taking its market cap to $2 trillion.

Despite early gains, NVIDIA's stock price ended flat on Wednesday. This follows a strong rally of over 7% the previous day. However, investor sentiment remains positive towards NVIDIA, driven by the ongoing growth in Artificial Intelligence, which has propelled the company's share price to double digits so far this year.

With the Fed projecting only one interest rate cut in December, all eyes will be on whether the PCE inflation data continue to show a moderation in price pressures, after a recent improvement shown in the CPI data and outright deflation in the PPI. Another highlight for this week, is the first presidential debate of the 2024 election held later today between Donald Trump and Joe Biden.


EUR/USD backslid into the 1.0680 region on Wednesday ending the session 0.27% lower after the German GfK Consumer Confidence Survey for July ticked lower unexpectedly.

Fears over Eurozone elections intensified after French President Emmanuel Macron called for a snap election when his party suffered defeat in preliminary results from Marine Le Pen’s far-right National Rally (RN).

German consumer confidence backslid to -21.8 for July, missing the forecast recovery to -18.9.

US New Home Sales Change in May clocked in a -11.3% decline MoM on Wednesday, compared to the previous month’s 2.0%.

Later today, US Durable Goods Orders, revisions to first-quarter Gross Domestic Product (GDP), and weekly Initial Jobless Claims will be released.



Gold prices slipped around 1% to their lowest level in more than two weeks on Wednesday, weighed by a stronger dollar and higher bond yields, while traders looked forward to U.S. inflation data due later this week.

The focus this week will be on the U.S. Personal Consumption Expenditures Price Index, the Fed's preferred inflation gauge, which could shed light on the central bank's interest-rate path.

Also on the radar are U.S. first-quarter gross domestic product estimates and a crucial debate between President Joe Biden and Republican rival Donald Trump on Thursday.



Oil prices closed slightly lower on Wednesday, as daily gains were limited by an unexpected increase in U.S. inventories and a stronger dollar.

The Energy Information Administration's data revealed that both domestic crude and gasoline stocks saw a surprising rise last week, contrary to the anticipated summer drop in crude inventories.

Geopolitical tensions between Israel and Lebanon's Hezbollah have been intensifying in recent weeks, sparking concerns of a potential Israel-Hezbollah conflict that could potentially involve other regional powers, including major oil producer Iran.

This week's primary focus is on the key PCE price index data, which serves as the Fed’s preferred inflation measure and is likely to influence the central bank’s outlook on interest rates.


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U.S. stock index futures fell slightly on Wednesday, with major chipmaking stocks retreated after memory chip major Micron offered a somewhat middling outlook on earnings.

Micron Technology Inc experienced an almost 8% decline in after-hours trading following a somewhat underwhelming outlook for the current quarter by the memory chip maker.

Investors remained cautious ahead of further economic indicators this week, primarily the release of the PCE price index data, which serves as the Federal Reserve's favoured measure of inflation. This reading is scheduled for release on Friday and is expected to influence the forecast for interest rates.

Markets were also on edge before the first Presidential debate of the year, between Democrat and Republican front-runners Joe Biden and Donald Trump.

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The materials contained on this document should not in any way be construed, either explicitly or implicitly, directly or indirectly, as investment advice, recommendation or suggestion of an investment strategy with respect to a financial instrument, in any manner whatsoever. Any indication of past performance or simulated past performance included in this document is not a reliable indicator of future results. For the full disclaimer click here.

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