Factory orders fell 1.0 percent in May, a slightly larger drop than expected. May core capital goods orders were revised from a gain of 0.4 percent from last week’s durables report to a decline of 0.4 percent.
Revisions Take Away Scant Gains
- In an environment of falling prices and scaled back spending on anything related to crude oil, it has been an uphill battle for the manufacturing sector. Factory orders have fallen nine out the past 10 months. There is no talking your way out of that.
- One major takeaway from this report is that core capital goods orders went from a positive 0.4 percent change in May to a negative 0.4 percent change.
Weak Core Capital Goods Shipments Bad for Q2 GDP
- We already knew from the durable goods report that civilian aircraft orders dropped 35.3 percent in May. We learned today that even when you strip away the volatile transportation sector orders increased just 0.1 percent.
- Shipments of core capital goods fell 0.1 percent in May, bringing the 3-month annualized figure to negative 2.8 percent, which raises concerns about business spending in the second quarter.
Recommended Content
Editors’ Picks
EUR/USD edges lower toward 1.0700 post-US PCE
EUR/USD stays under modest bearish pressure but manages to hold above 1.0700 in the American session on Friday. The US Dollar (USD) gathers strength against its rivals after the stronger-than-forecast PCE inflation data, not allowing the pair to gain traction.
GBP/USD retreats to 1.2500 on renewed USD strength
GBP/USD lost its traction and turned negative on the day near 1.2500. Following the stronger-than-expected PCE inflation readings from the US, the USD stays resilient and makes it difficult for the pair to gather recovery momentum.
Gold struggles to hold above $2,350 following US inflation
Gold turned south and declined toward $2,340, erasing a large portion of its daily gains, as the USD benefited from PCE inflation data. The benchmark 10-year US yield, however, stays in negative territory and helps XAU/USD limit its losses.
Bitcoin Weekly Forecast: BTC’s next breakout could propel it to $80,000 Premium
Bitcoin’s recent price consolidation could be nearing its end as technical indicators and on-chain metrics suggest a potential upward breakout. However, this move would not be straightforward and could punish impatient investors.
Week ahead – Hawkish risk as Fed and NFP on tap, Eurozone data eyed too
Fed meets on Wednesday as US inflation stays elevated. Will Friday’s jobs report bring relief or more angst for the markets? Eurozone flash GDP and CPI numbers in focus for the Euro.