U.S durable goods orders unexpectedly rose 0.8% in June, as growing exports have offset weakness in the U.S. Orders ex transportation jumped 2.0% which is the highest in seven months, for the less volatile reading. Looking at the breakdown the improvement was led by a 5% increase in electronics and a 5.1% rise in primary metal orders. It was the second month of gains as last month’s flat reading was upwardly revised to 0.1%. Also the booking for non-defense capital goods advanced 1.4% signaling that future goods orders will remain strong. The data contrasts the dour housing and job data that crossed the wires yesterday. Yet, expectations are that growth will decline further as the effects of the fiscal stimulus package dissipate. The Fed is expected to leave interest rates unchanged until the end of the year where traders are pricing in a 44% chance of a rate hike at the December policy meeting. – John Rivera, Currency Analyst
