Rates Increase on ECB Chief Draghi Comments

Mortgage interest rates increased this past week on comments from European Central Bank’s Draghi that they may need to begin to remove its current stimulus, a reversal of comments made just a couple of weeks ago.  Economic data was mixed.  Economic data stronger than expected included the June Consumer Confidence Index, May International Trade in Goods, the final look at Q1 GDP, the June Chicago Purchasing Managers Index, and the University of Michigan Consumer Sentiment Index.  The Chicago Purchasing Managers Index reached its highest level since May of 2014.  Economic data weaker than expected included May Durable Goods Orders, May Pending Home Sales, weekly jobless claims, and the Core Personal Consumer Expenditures Index.  The IMF reduced its growth forecast for the U.S. in 2017 to 2.1%.  The Treasury auctioned $88 billion of 2 Year Notes, 5 Year Notes, and 7 Year Notes, which were met with somewhat soft demand.  In Europe, the Eurozone Business and Consumer Survey Index reached its highest level in almost a decade.

 

The Dow Jones Industrial Average is currently at 21,362, down slightly on the week.  The crude oil spot price is currently $45.28 per barrel, up over $2 per barrel on the week.  The Dollar weakened versus the Euro and strengthened versus the Yen on the week.

 

Next week look toward Monday’s PMI Manufacturing and ISM Manufacturing Index, Wednesday’s Factory Orders and FOMC Minutes, Thursday’s International Trade and Jobless Claims, and Friday’s employment report for June as potential market moving events.  Markets are closed Tuesday for Independence Day.