US stocks have added another like to that outside after US GDP came in weaker but the inflation measures were higher. The core PCE prices for the quarter rose 3.7% higher than the 3.4% estimate. That has investors worried about lower growth/ higher prices. Not good.
In premarket trading:
- Dow Industrial Average -436 points
- S&P index -56.3 point
- NASDAQ index -249 point
Looking at the US debt market, yields are higher as well:
- 2 year yield 4.987%, +5.0 basis points
- 5-year yield 4.710%, +5.1 basis points
- 10 year yield 4.697%, plus or .4 basis points
- 30-year yield 4.812%, +2.9 basis points
The US dollar has moved higher as well:
- EURUSD is trading back below the 1.0700 level at 1.0685. 100-day moving average comes at 1.06779 and is the next target on the downside.
- GBPUSD was trading above it 100-day moving average on a 4-hour chart at 1.25149. The current price is trading at 1.2476. The broken 38.2% retracement of the April trading range is below at 1.2455. Earlier today, the price based against that level before moving higher.
- USDJPY is moving back to the upside and trading at 155.64 after reaching a low of 155.30 on the initial reaction to the lower GDP. The bounce back off of the higher inflation, as a person back toward the high for the day near 155.734. That high represents the highest level since 1990.
The markets are now discounting around 35 basis points of cuts between now and the end of the year. That compares to 42 basis points prior to the data dump today.