- US June consumer confidence 109.7 vs 104.0 expected
- US May advance durable goods orders (preliminary) 1.7% versus -1.0% expected
- Canada May CPI 3.4% y/y versus 3.4% expected
- Richmond Fed manufacturing index for June -7 versus -15 last month
- US May new home sales 763K vs 675K expected
- ECB's Wunsch: Rate pause would need a clear signal of slowing core inflation
- US treasury auctions off $43 billion of 5-year notes at a higher yield of 4.019%
- S&P Case Schiller for April 0.9% versus 0.4% expected
- Atlanta Fed GDPNow dips to 1.8% from 1.9% last
- ECB sources: Sees little chance of a pause in rate hikes in July or September
- Dallas Fed Texas June service sector outlook survey -8.2 vs -17.3 prior
- ECB's Wunsch: We must accept that our ability to fix inflation at exactly 2% is limited
Markets:
- Gold down $9 to $1913
- US 10-year yields up 4.7 bps to 3.77%
- WTI crude oil down $1.57 to $67.79
- S&P 500 up 44 points, or 1.0%, to 4415
- Nasdaq up 1.6%
- EUR leads, JPY lags
US economic data continued to impress, burying inflation fears. The market was in the mood to listen to what the data was saying and it was strong on the consumer and housing side. Manufacturing was solid, though the strong downward revisions to durable goods took much of the sizzle out of the headline.
The dollar gains following the data were largely limited to the yen as that pair broke 144.00 for the first time since November. The pair was boosted by rising Treasury yields across the curve.
EUR/USD was resilient but fell back from a high of 1.0976 after the US data and carved out a range around 1.0960. The ECB sources talk continues to highlight a more-aggressive path of tightening, thought the public comments are more balanced.
Cable has stayed strong but repeatedly ran into sellers at 1.2760 today. It was the second day of gains for the pound.
There's a big of a logical disconnect between stock and commodity markets at the moment. Risk appetite is improving steadily but it's not coming with a bid for commodities. Oil is near the lows of the year and fell $1.60 today as the market stresses about oversupply. That Canadian dollar has been benefiting from risk appetite despite the dichotomy but that changed today as it lagged on the combination of softening data and oil. It touched a low of 1.3117, which is the best since September, before reversing to 1.3190.
