Durable goods orders – not as good as headline number says

Dollar is taking a sharp hit ahead of the meeting as Durable goods order, a measure of economic and industrial strength fail to impress upon.

By some measures, the economic data was strong enough, but fails to provide enough of conviction over US economic strength.

Key highlights -

• Headline number showed, orders grew by 3.4% in June, however orders excluding transportation rose only by 0.8%.
• Fabricated metals orders were up 2.0% in June, the third consecutive increase.
• Machinery orders also increased every month in Q2.
• Weakness remained persistent in defense and transports. Though airplane orders remains solid, but volatile.

Since headline numbers got a boost from 66% rise in civilian aircraft orders, dollar was pushed back sharply after initial gains.

However the data pose early evidence that manufacturing activity might be picking up once more after first quarter slump.

Dollar is sharply down across the board today.

• Euro is up 1.22% against dollar so far.
• Pound is up 0.65% against dollar so far.
• Yen is up 0.45% against dollar so far.
• Franc is up 0.65% against dollar so far.