Login Open account
Australia
By using our website you agree to our use of cookies in accordance with our cookie policy.
Okay
Dismal Philly Fed survey spooks US markets Dismal Philly Fed survey spooks US markets Dismal Philly Fed survey spooks US markets

Dismal Philly Fed survey spooks US markets

Macro 4 minutes to read
MO
Michael O’Neill

FX Trader, Loonieviews.net

Summary:  December's US Durable Goods print was lukewarm, but the latest jobless claims data sounded a positive note. Into today's New York bell, however, it seems as though a dismal miss from the Philadelphia Fed Manufacturing Survey was the release that moved sentiment lower.

There was a smorgasbord of incoming US economic data this morning, but FX traders didn’t find it very appetizing. There was a bit of FX noise when the data were released but prices quickly reverted to their starting points.

The picture was a little different on the equities front, however, as the weaker than expected US figures snapped a nascent rally on Wall Street. Equity futures pointed to a positive open in early New York trading, but sentiment turned negative after the data dump. It is still very early in the session, though, and the declines are modest.

December Durable Goods Orders were lukewarm. The headline increase of 1.2% was better than the upwardly revised November result of 1.0% but below forecasts for a 1.5% gain. It is the second consecutive increase but still not enough to recover from October's 4.3% plunge. Excluding transportation, Durable Goods Orders rose 0.1%. (forecast 0.3%, month-on-month). 
Philly Fed
The Philadelphia Fed Manufacturing Survey was extra-ugly, falling 4.1 rather than rising 14.0 as expected. It was the first negative reading since May 2016. Initial Jobless Claims was the bright spot, dropping to 216,000 from 229,000 the week before.
General activity
Source: Federal Reserve Bank of Philadelphia
It isn’t any wonder why FX and equity traders are staying close to home, as there is plenty of event risk in addition to flip-flopping central bank policies. China and the US are reportedly working on “memorandums of understanding” as the framework for a trade deal. The talks continue on Friday and could lead to President Trump delaying the March 1 tariff increase. On the other hand, traders may be leery about China’s trade policies after Beijing was incensed by Australia’s cyber-security concerns and visa issues for a Chinese businessman and quickly banned Australia coal imports.

USDCAD traders would be wise to take note as China is furious with Canada over its arrest of Huawei CFO Meng Wanshou. 

Eurozone trade issues are sure to cause a kerfuffle as there are reports that President Trump has what he needs to impose tariffs on the import of EU cars. A “no-deal Brexit is another issue. The risk of GBPUSD instability could trigger a massive shift into risk aversion trades, and so could escalating Russia/US tensions over missile deployments.
EURUSD 30 minute
EURUSD (30-minute, source: Saxo Bank)

Outrageous Predictions 2023: The War Economy

  • Billionaire coalition creates trillion-dollar Manhattan Project for energy

    The constantly growing global need for energy drives the world's richest to huddle up and launch a R&D project in a size the world hasn't seen since the Manhattan Project gave the US the first atomic bomb.
    Read article

  • French President Macron resigns

    The political stalemate in France and the rise of Marie Le Pen following the 2022 elections corners President Macron, forcing him to give up on politics and resign from his position. At least for now.
    Read article

  • Gold rockets to USD 3,000 as central banks fail on inflation mandate

    As markets and central banks realise that the idea that inflation is transitory is wrong, and that prices will remain higher for longer, gold is sent through the roof, hitting a price tag of USD 3,000
    Read article

  • EU Army forces EU down path to full union

    With continued challenges in the region and a US military that isn't aggressively enacting its former role as global policeman, the European Union agrees to create its own armed forces, bringing the whole region closer.
    Read article

  • A country agrees to ban all meat production by 2030

    In an effort to become one of the global leaders on the path to net-zero emissions, one country decides to not only put a heavy tax on meat, but to ban domestic production entirely.
    Read article

  • UK holds UnBrexit referendum

    Following a recession and domestic pressure, the United Kingdom is thrown into political turmoil that will end with a vote to wind back Brexit.
    Read article

  • Widespread price controls are introduced to cap official inflation

    History tells us that with the war economy comes rationing and price controls. And this time is no different, as policymakers introduce strict price controls that lead to a range of unintended consequences.
    Read article

  • OPEC+ & Chindia walk out of the IMF, agree to trade with new reserve asset

    Sanctions against Russia have caused widespread turmoil due to US Dollar moves in countries across the globe that don't consider the US an ally. To relieve themselves from this, they leave the IMF and create a new reserve asset.
    Read article

  • USDJPY fixed to the USD at 200 as Japan overhauls financial system

    Following the challenges that faced the Japanese Yen in 2022, the Bank of Japan attempts to keep the currency from sliding. Unsuccessful on the long-term, Japan will launch a reset of its entire financial system.
    Read article

  • Tax haven ban kills private equity

    With the war economy comes an increased focus on national interests and sovereign nations' ability to assert themselves. In that regard, the OECD countries turn their attention on tax havens and pull the big guns out, banning them altogether.
    Read article
Disclaimer

Saxo Capital Markets (Australia) Limited prepares and distributes information/research produced within the Saxo Bank Group for informational purposes only. In addition to the disclaimer below, if any general advice is provided, such advice does not take into account your individual objectives, financial situation or needs. You should consider the appropriateness of trading any financial instrument as trading can result in losses that exceed your initial investment. Please refer to our Analysis Disclaimer, and our Financial Services Guide and Product Disclosure Statement. All legal documentation and disclaimers can be found at https://www.home.saxo/en-au/legal/.

The Saxo Bank Group entities each provide execution-only service. Access and use of Saxo News & Research and any Saxo Bank Group website are subject to (i) the Terms of Use; (ii) the full Disclaimer; and (iii) the Risk Warning in addition (where relevant) to the terms governing the use of the website of a member of the Saxo Bank Group.

Saxo News & Research is provided for informational purposes, does not contain (and should not be construed as containing) financial, investment, tax or trading advice or advice of any sort offered, recommended or endorsed by Saxo Bank Group and should not be construed as a record of our trading prices, or as an offer, incentive or solicitation for the subscription, sale or purchase in any financial instrument. No representation or warranty is given as to the accuracy or completeness of this information. All trading or investments you make must be pursuant to your own unprompted and informed self-directed decision. No Saxo Bank Group entity shall be liable for any losses that you may sustain as a result of any investment decision made in reliance on information on Saxo News & Research.

To the extent that any content is construed as investment research, such content was not intended to and has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such, would be considered as a marketing communication.

None of the information contained here constitutes an offer to purchase or sell a financial instrument, or to make any investments.Saxo Capital Markets does not take into account your personal investment objectives or financial situation and makes no representation and assumes no liability as to the accuracy or completeness of the information nor for any loss arising from any investment made in reliance of this presentation. Any opinions made are subject to change and may be personal to the author. These may not necessarily reflect the opinion of Saxo Capital Markets or its affiliates.

Please read our disclaimers:
- Full Disclaimer (https://www.home.saxo/en-au/legal/disclaimer/saxo-disclaimer)
- Analysis Disclaimer (https://www.home.saxo/en-au/legal/analysis-disclaimer/saxo-analysis-disclaimer)
- Notification on Non-Independent Investment Research (https://www.home.saxo/legal/niird/notification)

Saxo Capital Markets (Australia) Limited
Suite 1, Level 14, 9 Castlereagh St
Sydney NSW 2000
Australia

Contact Saxo

Select region

Australia
Australia
Products & pricing
Platforms
Accounts & service
General
Other
Legal

Trading can result in losses. Please ensure you understand the risks.

The Saxo trading platform has received numerous awards and recognition. For details of these awards and information on awards visit www.home.saxo/en-au/about-us/awards

Saxo Capital Markets (Australia) Limited ABN 32 110 128 286 AFSL 280372 (‘Saxo’ or ‘Saxo Capital Markets’) is a wholly owned subsidiary of Saxo Bank A/S, headquartered in Denmark. Please refer to our General Business Terms, Financial Services Guide, Product Disclosure Statement and Target Market Determination to consider whether acquiring or continuing to hold financial products is suitable for you, prior to opening an account and investing in a financial product.

Trading in financial instruments carries various risks, and is not suitable for all investors. Please seek expert advice, and always ensure that you fully understand these risks before trading. Saxo Capital Markets does not provide ‘personal’ financial product advice, any information available on this website is ‘general’ in nature and for informational purposes only. Saxo Capital Markets does not take into account an individual’s needs, objectives or financial situation. The Target Market Determination should assist you in determining whether any of the products or services we offer are likely to be consistent with your objectives, financial situation and needs.

Apple, iPad and iPhone are trademarks of Apple Inc., registered in the US and other countries. AppStore is a service mark of Apple Inc.

The information or the products and services referred to on this website may be accessed worldwide, however is only intended for distribution to and use by recipients located in countries where such use does not constitute a violation of applicable legislation or regulations. Products and Services offered on this website is not intended for residents of the United States and Japan.

Please click here to view our full disclaimer.