GDP Contracts 0.9%


Stock index futures closed sharply higher yesterday after Federal Reserve Chair Powell said the central bank could eventually slow the pace of tightening when it would become clear that inflation has peaked or in case of a dramatic economic slowdown.

Jobless claims in the week ended July 23 were 256,000 when 249,000 were expected.

The second quarter gross domestic product declined 0.9% when a 0.5% increase was expected.

The July Kansas City Federal Reserve manufacturing index will be released at 10:00. In June it was 12.

Futures have recently been supported by the belief that the Federal Open Market Committee is becoming less hawkish.

In addition, the technical aspects are becoming more friendly.


The U.S. dollar index is higher, and the euro currency is lower.

The euro currency has come under pressure recently due to recession concerns and the ongoing energy crisis in Europe.

Confidence in the euro area economy fell to the weakest level in almost 1 1/2 years.

The annual inflation rate in Germany edged lower for a second straight month to 7.5% in July of 2022 from 7.6% in June, although economists were expecting a smaller 7.4% reading.

The long term trend for the euro is lower and the long term trend for the U.S. dollar is higher.


The Federal Open Market Committee hiked its fed funds rate by 75 basis points as expected, which is the second hike in a row of that size.

The next FOMC meeting is scheduled for September 21.

The Treasury will auction seven-year notes today.

Higher prices are likely across the board for the interest rate market futures as the U.S. economy continues to weaken.

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