Stronger Economic Reports in Japan
The U.S. dollar index fell to a 5-month low today. The greenback has been under pressure due to expectations that the Federal Reserve will start cutting rates earlier than other central banks, including the European Central Bank.
Lower prices are likely for the U.S. dollar longer term.
Industrial production in Japan fell 0.9% month-over-month in November 2023, which compares to market estimates of a 1.6% decline.
Retail sales in Japan increased 5.3% year-on-year in November 2023, which was more than estimated. The median market forecast was for 5.0% growth.
STOCK INDEX FUTURES
Stock index futures are mixed to higher.
Jobless claims in the week ended December 23 were 218,000 when 210,000 were expected.
Wholesale inventories in November were down 0.2% as anticipated.
The 9:00 central time November pending home sales index is predicted to be up 0.8%.
The fundamentals and technicals remain supportive to stock index futures.
INTEREST RATE MARKET FUTURES
Futures are lower.
The Treasury will auction seven-year notes today.
Financial futures markets are predicting there is a 16% probability that the Federal Open Market Committee will reduce its fed funds rate by 25 points at its January 31, 2024 policy meeting and an 84% probability of no change.
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