The U.S. Commerce Department reported U.S. durable goods orders recovered far less than expected in March as demand for cars, computers and appliances slumped, dragging down the U.S. dollar. Consumers also appeared slightly pessimistic on the economy's short-term outlook and sent a measure of confidence lower in April.
The latest CNBC Fed Survey shows Wall Street anticipating a more dovish Fed in April than it did back in March, with the next rate hike not expected until much later this year.
Fully 100 percent of the 48 respondents to the survey, including economists, strategists and fund managers, are sure the Fed won't hike at its meeting this week. But 94 percent say the next move will be to hike rates. The next hike, on average, isn't expected until August, two months later than anticipated in the previous survey. And respondents don't see rates taking off after that. They lowered their funds rate forecast for 2016 to just 0.78 percent, compared with the current target of 0.38 percent. The rate is seen remaining low in 2017 at just 1.4 percent, 17 basis points less than forecast in the March survey.
Troubled Malaysian government investment fund 1Malaysia Development Bhd. defaulted on a series of bonds on Tuesday, weighing on the country’s stock and currency markets and raising concerns that the government may eventually have to spend billions to bail out the fund.
But debt markets largely took the development in stride, while credit raters said the Malaysian government has the ability to foot the bill.
1Malaysia Development Bhd., or 1MDB, confirmed that it is in default on a $1.75 billion bond it issued in 2012, after missing a $50 million interest payment due last week amid a dispute with the bond’s guarantor.
That default in turn triggered defaults on its two Islamic bonds, totaling 7.4 billion ringgit ($1.9 billion), 1MDB said in a written statement.
Crude oil futures rose half a dollar in early Asian trading on Wednesday and remained near 2016 highs on the back of strong investor sentiment and a weak dollar, although analysts warned this month's bull-run could soon run out of steam.
International Brent crude futures were trading at $46.26 per barrel at 0023 GMT, up 52 cents, or 1.1 percent, from their last settlement.
U.S. West Texas Intermediate (WTI) crude was also up 52 cents, or 1.2 percent, at $44.56 a barrel.
WTI was further lifted after the American Petroleum Institute (API) reported a drawdown of nearly 1.1million barrels in U.S. crude inventories last week versus a 2.4 million-barrel build expected by analysts in a Reuters poll.
Reference: Reuters, CNBC, WSJ
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