While a US holiday on Monday meant no activity from stateside, the US currency did briefly hit a four-year low against sterling. Disappointing US data from the Empire State Manufacturing Index released on Tuesday perversely saw the US dollar gain ground against sterling. The main event of the week was the minutes from the latest Federal Open Market Committee (FOMC) meeting, and markets were largely tentative ahead of this, while further underwhelming data figures from building permits and the Producers’ Price Index highlighted the lack of traction in the US recovery. The minutes showed that all members were in support of holding interest rates, although there were hints that the unemployment target for raising interest rates could be lowered supporting the notion that US interest rates will not be increased any time soon.
Yesterday then held mixed data and fortunes, as the Consumer Price Index and unemployment claims were as expected. The Manufacturing Index from the Philadelphia Fed was worse than anticipated, but the flash manufacturing Purchasing Managers’ Index figures were optimistic. Today holds one last data piece for the week, with the existing home sales. There are also words from a member of the FOMC for investors to mull over.
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