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US economic newsflow consistent with Fed rate hike in June

Ms Yellen has made it clear that the Fed's decision to start a new rate hike cycle will be data dependent. To get the timing right, a crucial question is whether US economic momentum remains convincingly strong.Societe G…

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US economic newsflow consistent with Fed rate hike in June
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Ms Yellen has made it clear that the Fed's decision to start a new rate hike cycle will be data dependent. 

To get the timing right, a crucial question is whether US economic momentum remains convincingly strong.

Societe Generale notes in a report on Wednesday:

  • Labour market conditions have clearly improved in recent months. In this context, we read the latest drop in the ISM index as a correction of an earlier, dubious, rise in the ISM not captured by our newsflow indicator. 

  • Only now, after a fall of several months, our US newsflow indicator has slightly improved, supporting the Societe Generale scenario that calls for a first rate hike in June.

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