Daily digest market movers: Gold price advances, capitalizing on soft US Dollar
- US GDP for Q1 2024 came in at 1.4% QoQ, slightly higher than the 1.3% in the previous two readings but still trailing last year's fourth-quarter expansion of 3.4%.
- US Durable Goods Orders in May rose by 0.1% MoM, surpassing forecasts of a -0.1% contraction. Meanwhile, Initial Jobless Claims dipped from 239K the previous week to 233K, below the forecast of 236K.
- Fed officials crossed the newswires during the week, and delivered mixed stances. Fed Governor Michelle Bowman was hawkish, saying that she would like to increase rates if the disinflation process stalls.
- Conversely, San Francisco Fed President Mary Daly was dovish: “At this point, inflation is not the only risk we face,” expressing worries about the labor market.
- Fed Governor Lisa Cook was neutral on Tuesday, saying that inflation was most likely to fall “sharply” next year, adding that it would be necessary to ease policy to keep the Fed’s dual mandate more balanced.
- According to the CME FedWatch Tool, odds for a 25-basis-point Fed rate cut in September are at 59.5%, up from 56.3% last Tuesday.
- December 2024 fed funds rate futures contract implies the Fed will ease policy by just 35 basis points (bps) toward the end of the year.
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