U.S. Review
Inflation Rising, Housing Not so Much
- Despite the acceleration in consumer prices, the Fed is unlikely to change its current course for a rate hike in the middle of next year.
- The housing recovery remains slow. Existing home sales perked up in June, while new home sales erased all of the gains made in May.
- Durable goods orders beat expectations and the factory sector looks to have improved further into July.
- The economy appears to have bounced back in the second quarter and should maintain growth just shy of 3 percent for the rest of the year.
Global Review
Global Economy Continues to Grow at Modest Pace
- Data released this week showed that real GDP growth in the United Kingdom remained above an annualized rate of 3 percent in the second quarter. Economic growth in the Eurozone, however, remains soft. It is difficult to envision a robust expansion if the French economy, which accounts for20 percent of Eurozone GDP, continues to struggle.
- The rate of real GDP growth in China has stabilized at around 7.5 percent in recent quarters, and the smattering of data that we have thus far in Q3 has also been encouraging.
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Editors’ Picks
EUR/USD holds above 1.0600 as focus shifts to Powell speech
EUR/USD fluctuates in a narrow range above 1.0600 on Tuesday as the better-than-expected Economic Sentiment data from Germany helps the Euro hold its ground. Fed Chairman Powell will speak on the policy outlook later in the day.
GBP/USD stays below 1.2450 after UK employment data
GBP/USD trades marginally lower on the day below 1.2450 in the early European session on Tuesday. The data from the UK showed that the ILO Unemployment Rate in February rose to 4.2% from 4%, weighing on Pound Sterling.
Gold price remains depressed near $2,370 amid bullish USD, lacks follow-through selling
Gold price (XAU/USD) attracts some sellers during the early part of the European session on Tuesday and reverses a major part of the overnight recovery gains from the $2,325-2,324 area, or a multi-day low.
XRP struggles below $0.50 resistance as SEC vs. Ripple lawsuit likely to enter final pretrial conference
XRP is struggling with resistance at $0.50 as Ripple and the US Securities and Exchange Commission (SEC) are gearing up for the final pretrial conference on Tuesday at a New York court.
Canada CPI Preview: Inflation expected to accelerate in March, snapping two-month downtrend
The Canadian Consumer Price Index is seen gathering some upside traction in March. The BoC deems risks to the inflation outlook to be balanced. The Canadian Dollar navigates five-month lows against the US Dollar.