All eyes on the release of the revised US GDP rate for Q4
The US Initial Jobless Claims for the week ending 17 February dropped to 201K from the previous week’s 213K. Continuing Claims also fell to 1.862M, below expectations and the prior week. The report indicated that the US labour market remains strong which could allow the Federal Reserve (Fed) to delay cutting interest rates. Expectations for the first rate cut from the Fed in May have now been reduced and postponed till June due to the robust job market and hotter-than-expected inflation numbers in January.
On Thursday, the US Manufacturing PMI improved to 51.5 in February from 50.7 in the previous reading, higher than the forecast of 50.5, and the best reading in 16 months. On the other hand, the Services PMI eased to 51.3 in February from 52.5 in January, lower than the 52.00 expected.
In the UK, preliminary Manufacturing PMI for February came in at 47.1 versus 47.0, but less than market expectations of 47.5. The Services PMI remained the same at 54.3 but above the consensus of 54.1. Composite PMI came in at 53.3, better than expectations and the previous reading of 52.9.
In terms of US economic data, we note the following: On Tuesday, we note US durable goods, while on Wednesday we highlight GDP rate for Q4 and retail sales. On Thursday, we note the release of consumption rate and Core Price Index for January. On Friday, we get ISM Manufacturing PMI figure and final University of Michigan consumer sentiment for February.
Expected Volatility – Medium
The US Gross Domestic Product Annualized (GDP) for the fourth quarter will draw attention. If the rate accelerates, the dollar will find support.