Major Market Mover: Durables And Homes

Here comes the last day of another week in the FOREX market, while investors are eagerly waiting for some data from the U.S. economy, and from the UK economy, data that might get markets on the track again, after all what is said and done by the U.S. officials earlier this week.

The start will be from UK, with the 2nd quarter advanced GDP reading, as expectations are to see the economy grew on a slower pace than the first quarter at 0.2%, while the annualized reading should be at 1.6% against 2.3 in the first quarter. The Britons suffers from very high inflation levels which keeps them from lowering their rates which is still considered as the highest amongst the world's largest economies, but with more deterioration on growth, they might eventually be forced to turn extremely dovish and start thinking of lowering rates.

Traveling to the United States, two important reports are lining up on out agenda, and the start will be with the durable goods orders for the month of June, which probably fell 0.3% from a flat reading in May, while durable good excluding transportations probably fell 0.2%, following a drop of 0.8% in May.

That's dear reader where we see the effect of soaring energy prices that added a lot of costs on companies and consumers, forcing them to lower their spending and try to seek necessities in life, while consumer confidence at the lowest level in 28 years, we shouldn't expect people to buy long lived assets till in an economy they don't have faith in, which makes the problem even worse.

In another important report, the U.S. new homes sales are expected to fall to 503 million units in June, down 1.8% from the 512 million units in May, confirming on yesterday's lower than expected existing homes sales report, and marking again an almost 28 years low for the housing sales, and lengthening the agony of the Feds and the U.S. economy.

As we said yesterday, the housing sector still one of the most important sectors in the economy, and we shouldn't expect any improvement in the economy as far as the housing market is still plunging, and as the feds are thinking about hiking rates according to Mr. Plosser, they are going to have to think it through, and they should really take the housing sector into consideration, as it did once, it can do it again.

Consumer confidence wonders around its lowest levels according to the estimate on the University of Michigan report today, posing more threats on a potential extension for the current economical crisis.

That's it for the day dear reader, and thank god it's Friday, so we can hold our breaths as much as we want today, we can be extremely careful from everything going in the markets, but eventually we can all go home and start our weekend with better hopes for the week to come…

Crown Forex

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