US: Less Dovish Fed Speak – Investec
Research Team at Investec, notes that in terms of US economic data yesterday, the main takeaway was further improvement in US manufacturing, with the March Chicago PMI reading showed an increase of 6pts last month to a better than expected 53.6 (vs. 50.7 expected), and the second highest reading since last July.
“Yesterday saw yet more Fed speakers with the latest comments coming from NY Fed President Dudley echoing Yellen's comments in so far as the Fed should look to proceed cautiously, while also speaking positively about the progress the US economy has made on employment and inflation objectives.
Dudley made few comments with regards to his outlook for further tightening but did note that, should the US economy stay on the current trajectory, then 'gradual normalization' is most likely.
Prior to this we also heard from Atlanta Fed President Lockhart and Chicago Fed President Evans again. Lockhart said that there is scope for three rate increases this year and Evans reiterated his call for two rate hikes this year. But the positive data and the less dovish Fed officials’ comments did not seem to do much for the US Dollar.”
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