U.S. markets celebrating
We’re one step closer to a first U.S. key rate hike after yesterday’s lineup of economic indicators south of the border all produced positive readings. Durable Goods Orders rose across the board, New Home Sales were respectable, the Services PMI was at its highest level in 7 months, in short, nothing but blue skies. We also learned yesterday that U.S. crude oil inventories rose by 961,000 barrels last week, which helped keep pressure on prices. For those of you keeping score, the likelihood of a key rate increase on December 16 now stands at 72%.
It is highly likely that the result will no longer be in doubt after next week when U.S. job data is announced on December 4. Any respectable showing will give market observers the last piece in the puzzle to set their expectations.
In the meantime, China has taken one more step toward becoming a world market player, as a first cohort of central banks, financial institutions and sovereign wealth funds have registered to access its interbank market. Next Monday (November 30), we will also learn whether the yuan will be granted reserve currency status.
