Daily digest market movers: Gold trims its losses amid upbeat Durable Goods Orders report
- US Durable Goods Orders significantly increased in March, expanding by 2.6% MoM, up from a 0.7% rise previously and surpassing 2.5%. When excluding transportation, Durable Goods Orders rose by 0.2% MoM, which was an improvement over February's 0.1% increase but fell short of the 0.3% projected.
- Upcoming Q1 GDP data, core PCE inflation figures will offer additional insights into potential timing of Fed's interest rate reductions. The Fed’s preferred inflation gauge, the core Personal Consumption Expenditures (PCE) Price Index, is estimated to remain steadily at 0.3%. The annual core PCE rate is expected to ease to 2.6%, down from February's rate of 2.8%, indicating potential softening of inflation pressure.
- Tuesday’s softer-than-expected S&P Global PMI report in the US increased odds for July rate cut. Chris Williamson, Chief Business Economist at S&P Global Market Intelligence, wrote: “The US economic upturn lost momentum at the start of the second quarter, with the flash PMI survey respondents reporting below-trend business activity growth in April.” This could help to bring down stubbornly sticky inflation, which remains well above the Fed's 2% core target.
- Data from the Chicago Board of Trade (CBOT) suggests that traders expect the fed funds rate to finish 2024 at 4.98%, up from 4.965% on Tuesday.
- US 10-year Treasury benchmark rate climbs six basis points (bps) at 4.66%.
- US Dollar Index (DXY) is up 0.18% to 105.87.
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