For the day ahead, I’ll be watching out for how markets prepare for President Donald Trump announcing his supreme court nominee on Saturday- as well as US durable goods data.
With five weeks to go until the election, there’s no doubt political uncertainty is playing a role in the current risk-off market environment. There is a specific reason for that in that economists had been basing their forecasts for a late year economic recovery off the idea there would be a second US stimulus package- but politicians couldn’t come up with an agreement.
Who the president picks as his supreme court nominee could shape the response from Democrats - and how drawn out the battle could be and distract from the need for further government support. Republicans plan the vote for October 29 according to the AP, four days before the election- and so far only 2 Republicans have come out against having the vote before the election. The favourite appears to be Judge Amy Coney Barrett.
As I mentioned yesterday, the US dollar has been breaking higher this week - putting the focus on the major data release today which is durable goods orders in August. The growth in the headline number is expected to have decelerated substantially to 1.5% from 11.4% and ex-transport orders are expected at 1.2%, down from 2.6%.
Pent up demand for vehicles with low interest rate loans pushed orders higher over the previous two months. Now that has gone economists will judge something closer to the real state of demand.
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