Today in the US session, we got a few second tier economic releases. They are second tier because their implications aren’t on the currency directly, but can build towards influencing monetary decision, which is a first tier factor.
We saw some downbeat housing data, but positive jobs and manufacturing numbers.
Housing: Building Permits for June fell to an annualized rate of 0.96M. The forecast was for a 1.04M reading, and the previous months’ reading was 1.01M, revised up from 0.99M. June’s reading was the lowest since January’s 0.94M. The softer building permits data was accompanied by weaker housing starts data. Housing Starts in June fell to an annualized rate of 0.89M, down from the 0.99M reading in May. Forecasts called for a 1.02M. Today’s unexpected snag in housing data stalls a recent trend of improving housing data.
Labor Market: Jobless claims data continue to improve. This past week, we saw 302K initial unemployment benefit claims. While a reading below 300K might start catching more attention, the overall trend of jobless claims has been improving and should be noted.
On another positive front, the Philly Fed Manufacturing Index in July improved to the highest reading since March 2011. The forecast was around a 15.6 reading, while the June reading was 17.8.
Janet Yellen mentioned yesterday – during her testimony in front of congress – that the housing front has been slower than expected, but “not quantitatively significant” to change monetary policy stance. She did also note the improvements in the manufacturing and jobs front. The data today are in-line with what the market has been expecting in general, even though none of today’s individual data was in-line with forecast.
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