Skip to content


US dollar unimpressed by strong data


  • durable orders show healthy demand in the US
  • new home sales close to consensus but January figure revised upwards
  • US dollar down again under weight of trade wars concerns

The US data released today was fairly strong even if it had little impact on the markets that could be completely somewhere else. Especially strong was the report on durable orders that showed a rise of 3.1% m/m in February. Although the headline number is often skewed by large-ticket items, the core, ex-transport measure showed a healthy growth as well (1.2% vs. the consensus of 0.5% m/m). More importantly, when looking at the y/y growth rates in both categories we see upward trajectory that seems to underscore strength of domestic demand in the US - a necessity for a scenario of higher demand-driven inflation.

link do file download link

A steady rise in durable orders is a good sign for the US economy. Source: Macrobond, XTB Research 

The new home sales report was pretty much flat, showing an annualized number of 618k new home sales in February, just a notch below the consensus (622k) but the January number has been revised upwards by 29k so overall data was modestly positive. 

It had little impact on the markets though. Investors are completely focus on ramifications of policy changes by Donald Trump who is clearly driven to implement solutions that reduce US trade deficit, even at a risk of global slowdown. As such the reasoning could be that he might opt for a weaker rather than stronger dollar, regardless of what he says publicly. 

link do file download link

USDIDX shows weakness despite decent data as investors focus on trade wars. Source: xStation5 

Looking at the chart of the US dollar index we can see a lot of weakness. The instrument remains in a long-term downward trend and after breaking a huge support zone around 92 it was unable to at least test it from below, reversing from a low point of 90.95 instead. Moreover, a completed "abc" correction could be an indication that the "recovery" phase is over.  The key support is at 88.35. 



This article is provided for general information purposes only. Any opinions, analyses, prices or other content is provided for educational purposes and does not constitute investment advice or a recommendation. Any research has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such is considered to be a marketing communication. Any information provided does not have regard to the specific investment objectives, financial situation and needs of any specific person who may receive it.

Past performance is not necessarily indicative of future results, and any person acting on this information does so entirely at their own risk, we do not accept liability for any loss or damage, including without limitation, any loss of profit, which may arise directly or indirectly from the use of or reliance on such information.