New orders for capital goods increased more than expected in August and shipments continued their upward trend, suggesting strength in the economy despite an anticipated drag on growth from Hurricanes Harvey and Irma.
Durable goods orders rose by 1.7% in Aug compared with expectations of a 1% increase. Signs of an acceleration in business spending on equipment bolstered prospects of a December interest rate hike by the Federal Reserve, boosting the dollar and pushing up the yield on the two-year U.S. Treasury note to its highest level since 2008.
The Commerce Department said on Wednesday non-defence capital goods orders excluding aircraft, a closely watched proxy for business spending plans, rose 0.9 percent last month after an upwardly revised 1.1 percent gain in July.
Sterling rose to a 10-week high against the euro on Wednesday, lifted by data showing British retail sales growth hit a two-year high during the first part of this month, which bolstered bets on a Bank of England rate hike in November. The Confederation of British Industry (CBI) said its retail sales balance jumped to +42 in September from a reading of -10 in August, the highest since September 2015 and far above economists’ expectations.
09:15 - GBP: BoE Governor Mark Carney Speech
14:30 - USD: US annualised GDP (Q2) expected to be unchanged at 3%