On January 27, data released by the U.S. Department of Commerce showed that the preliminary value for durable goods orders in November increased by 5.3% month-on-month, significantly surpassing the market expectation of 3.8% and successfully reversing the previous month's decline of 2.2%. Core orders excluding the transportation category also rose by 0.5% month-on-month, exceeding expectations. This marks the eighth consecutive month of growth for this indicator, driving the year-on-year increase in overall equipment investment to 4.4%, the highest level since October 2022. As a key barometer of corporate equipment investment willingness, core capital goods orders (excluding aircraft and defense-related capital hardware) grew by 0.7% month-on-month, outperforming market expectations. The strong performance of U.S. durable goods orders in November was primarily driven by commercial aviation demand. Data indicated a sharp surge in orders for non-defense aircraft and related parts, which became the core driver of the overall order growth. In contrast, defense-related spending declined, while automotive orders remained largely stable, reflecting the structural characteristics of the order recovery.
Furthermore, J.P. Morgan recently issued a preview research report regarding this week's Federal Reserve policy decision. The bank stated that this meeting would not release new interest rate dot plots or economic projections, and modifications to the post-meeting statement are unlikely to convey substantial policy signals. During the press conference, the bank expects Chairman Powell to indicate that current policy is well-prepared to address various risks to the Fed's dual mandate and believes he will avoid discussing politically charged issues related to the Fed. The bank anticipates that the Fed's leadership will easily secure a solid majority in favor of keeping interest rates unchanged, a judgment considered almost certain. The bank expects several adjustments in the statement: the description of economic growth might be upgraded from "moderate" to "solid"; job growth may still be described as slowing, but unlike the previous statement's mention of a "small increase in the unemployment rate before September," this week's statement might note that the unemployment rate has stabilized in recent months. The bank expects inflation to still be described as "somewhat elevated."
Data to watch today include France's January Composite Consumer Confidence Index and the U.S. January Conference Board Consumer Confidence Index.
Dollar Index The Dollar Index trended lower yesterday, briefly falling below the 97.00 mark to hit a fresh 4-month low, with the spot rate currently trading around 97.10. Persistent concerns over trade uncertainties continued to weigh on the currency, while a crisis regarding the Federal Reserve's independence also exerted some downward pressure. Additionally, worries about a potential renewed U.S. government shutdown further contributed to the selling pressure. Attention today is on resistance near 97.50, with support located around 96.50.
EUR/USD The Euro moved higher yesterday, testing the 1.1900 level and reaching a new 4-month peak, with the spot rate currently trading around 1.1880. The primary support for the Euro's climb came from the Dollar Index's retreat to defend the 97.00 level, pressured by bearish factors including trade uncertainties and fears of another U.S. government shutdown. Moreover, positive economic data released from Germany during the session provided additional support. Focus today is on resistance near 1.1950, with support around 1.1800.
GBP/USD The British Pound advanced yesterday, testing the 1.3700 level and hitting a fresh 4-month high, with the spot rate currently trading around 1.3680. The main driver behind the Pound's ascent was the continued slide in the Dollar Index, which hit a new 4-month low under pressure from multiple adverse factors. Furthermore, the positive impact of last Friday's stronger-than-expected UK economic data continued to underpin the currency. Attention today is on resistance near 1.3750, with support situated around 1.3600.
Comments