Economic wrap: mixed US data and Fed speak - Westpac
|Analysts at Westpac offered an economic wrap.
Key Quotes:
"US: Feb durable goods orders (advance) rose a healthy 1.7% (vs 1.4% expected), thanks to a 4.3% rise in transportation orders, and the previous month was revised up +0.3ppts to 2.3%. The core data was less impressive - core capital goods shipments slipped 0.1% (0.5% expected), with a mild +0.2ppt revision to the previous month a small compensating positive. More encouragingly for Q1 GDP, core shipments rose 1.0% (0.2% expected) so there will be a small uplift to business investment in Q1 GDP expectations. Mar flash PMIs for both manufacturing and services undershot expectations but remained well inside expansionary territory.
FOMC non-voter Bullard sounded particularly dovish (although his profile has shifted to the centre, he has always had a propensity for dovishness), stating that he has "the lowest rate path forecast on FOMC" and responded to a question on hikes by saying that although they could rise again this year, "we do not need to be aggressive on rates". In contrast, dove Dudley, who is a permanent voter, felt the Fedias close to its employment and inflation objectives, and warned of the risks of overheating if unemployment fell further. He said tightening has been “extraordinarily gradual” and felt the economy can absorb further rate hikes."
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