Dismal American data underscores soaring headwinds to US economy

Dismal American data underscores soaring headwinds to US economy

In December, new orders for major American capital goods suddenly slumped in the face of decreasing demand for machinery as well as primary metals, indicating a sustained deceleration in business spending on equipment, which could further impact economic surge.

On Thursday, the US economy's outlook was also affected by other reports that disclosed that a measure of factory activity in the mid-Atlantic region dived in February for the first time since May 2016, while in January, home resales went down to a more than three-year minimum.

Along with the previous week’s data, Thursday’s reports revealed abrupt dives in retail sales in December as well as manufacturing output in January that backed the major US bank’s stance toward lifting interest rates further in 2019.

Minutes of the Fed’s January 29-30 policy gathering issued on Wednesday noted that certain risks to the downside had tacked on, with regard to the outlook for the American economy. The major US financial institution left interest rates on hold at that gathering and also discarded pledges of more lifts in borrowing costs.

As the Commerce Department informed, without aircraft, orders for non-defense capital goods went down by 0.7%. November’s data was updated downwards to demonstrate core capital goods orders tumbled by 1% instead of tumbling by 0.6% as earlier disclosed.

Market experts interviewed by Reuters had predicted core capital goods orders would soar by 0.2% in December. As for core capital goods orders, they headed north by 6.1% on a year-on-year basis.

Moreover, in December, shipments of core capital goods rallied by 0.5% following an  unrevised 0.2% soar in November. As a rule, core capital goods shipments are utilized to calculate equipment spending in the US cabinet’s GDP measurement.


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The Federal Reserve (Fed) will announce its Interest Rate Decision and make a statement about the future monetary policy on Wednesday, September 21, GMT+3. After the higher-than-expected inflation numbers published on September 13, there’s almost no doubt the Federal Reserve will come up with another 75-basis-point rate hike. However, surprised by the CPI numbers, several Fed members announced the possibility of a 100-basis-point rate hike on Wednesday.

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