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Today, we’re here to discuss some key economic indicators that are making waves in the market:
US Economic Indicators Signal Soft Landing
Last Friday, US durable goods and finalized Michigan Consumer Sentiment figures provided a glimmer of hope for a soft landing of the US economy. Durable goods orders, excluding transportation, saw a 0.4% increase in September, following a 0.6% rise in August. Additionally, the Michigan Consumer Sentiment Index rose from 70.1 in September to 70.5 in October, surpassing initial estimates of 69.0.
While this positive data supported investor optimism for a smooth landing, it also tempered expectations of a December Fed rate cut. As per the CME FedWatch Tool, the likelihood of a 25-basis point rate cut in December declined from 74.6% to 70.3%.
Japan General Election Shock
Over the weekend, Japan’s Liberal Democratic Party (LDP)-Komeito coalition experienced a surprising setback in the snap general election. Falling short of the 233-seat majority threshold, the ruling coalition now faces the challenge of forming a government through negotiations with smaller parties, potentially requiring concessions. Political uncertainty and its potential impact on the Bank of Japan’s rate trajectory influenced demand for the Japanese Yen.
On Monday, the USD/JPY pair saw a 1% increase to 153.758, reflecting investor sentiment following the election outcome.
China Industrial Profit Signal Weakening Demand
In China, recent economic data painted a gloomy picture of weakening demand. Industrial profits took a hit, dropping by 3.5% year-on-year from January to September after a modest 0.5% gain in August. This unexpected decline in profits echoed the trend seen in trade data, with exports growing by a meager 2.4% year-on-year in September, down from 8.7% in August.
Stay tuned to the Extreme Investor Network for the latest updates and insights on these economic indicators and more. Our expert analysis and unique perspectives will help you navigate the ever-evolving landscape of the stock market with confidence. Subscribe to our blog today for exclusive content that will take your investing game to the next level!