US PCE prices rose 0.4% for January with an annual rate at 1.9% from 1.6% and close to the Fed’s 2% target, although the core increase was held to 1.7% and unchanged from the previous month.
The ISM manufacturing index rose to 57.7 for February from 56.0 in January and this was the highest reading for over two years which maintained confidence in the outlook. The dollar was still subjected to some profit taking and the Euro rallied back above the 1.0550 level.
Fed Governor Brainard stated that the US economy appeared to be in a transition phase to a more stable growth path and that gradual interest rate increases are likely to be appropriate soon. There were also comments that a shrinking of the balance sheet could start before too long.
Given that Brainard has consistently been one of the most dovish FOMC members and resisted calls for higher rates, the commentary maintained increased expectations of a March rate increase which continued to support the dollar. The trade-weighted index hit a seven-week high and the Euro was below 1.0550 on Thursday.
USD 2 Trillion Trade Deals That is the total trade deal bag that POTUS Trump is credited admittedly by himself with snagging in his whirlwind Gulf trip this week. Many are puzzled and a few have attempted to tot up the value of the Saudi, UAE and Qatari deals, but no-one has succeeded in getting […]
UK Borrowing Another one for the pub quiz in case it comes up: UK government borrowing stands at £2.8 trillion or £2800 billion. While you digest that number over the chicken in the basket if indeed you are already in the pub, it will have increased by the time you get to the end of this […]
POTUS in Kingdom of Saudi Arabia As one of POTUS’ travelling companions on this week’s visit, Larry Fink of Blackrock represents everything that a US President might want to burnish his credentials in the desert kingdom: head of the largest asset manager on the planet, hugely influential and totally credible. Just a shame that he […]