Ascending Optimism about Mid-East Peace Talks and AI… U.S. Data Reports on Deck
June 25, 2026
A rash of important U.S. economic data will be reported shortly, including revised GDP, personal income and spending, durable goods orders, the Chicago Fed National Activity Index and weekly jobless insurance claims.
Meanwhile, mounting optimism fed by reported progress in the peace talks between Iran and the United States and regarding greater shipping traffic through the Strait of Hormuz has depressed the price of WTI oil below $70 per barrel, thus reversing almost all of its wartime spike. AI share prices have reacted positively to the stellar Micro Technology earnings report that highlighted record earnings per share and revenues that exceeded expectations by around 16%.
In other world news headlines, Venezuela suffered two earthquakes west of Caracas measuring over 7.0 on the Richter scale.
The dollar is holding firm at a 14-month weighted high after gains of 0.1-0.2% overnight. Japan’s stock market closed with a whopping gain today of 4.6%, and the South Korean Kospi rebounded by an even greater 5.4%. Major European stocks markets are up 0.4-0.7%. A half hour prior to today’s batch of U.S. data saw key U.S. equity indices in futures trading with widely disparate gains of of 0.2% in the Dow but a 2.1% jump in the tech-laden Nasdaq.
Among ten-year sovereign debt yields, the U.S. Treasury is two basis points higher, the Japanese JGB has shed three bps, and major European yields are unchanged. Bitcoin’s price has reversed 0.3% of yesterday’s slump. Gold and silver prices have dropped 0.4% and 1.5%.
Among reported data released overseas, Japan’s leading and coincident economic indiciators for April each got revised 0.2 points higher to their best readings in 57 and 83 months, respectively.
French consumer confidence rose two index points last month above April’s 38-month low.
German consumer sentiment, although at a three month high, remained very weak. The reading of -29.2 was more negative than anticipated.
Spanish real GDP last quarter was left unrevised with growth of 0.6% compared to the final quarter of 2025 and 2.7% vis-a-vis the year-earlier quarter. Among Euroland’s four largest economies, Spain has consistently topped the others in the post-pandemic era.
Spain also reported a further jump in producer price inflation to 10.5% last month from 8.5% in April, 3.1% in March, and -6.9% in February. South African producer price inflation accelerated to 7.8% in May from 4.8% in April, 2.3% in March and 1.8% in February.
The CRB’s June survey of British distributive services unexpectedly relapsed to a reading of -54 from -46 in May and -68 in April.
Australia’s labor market improved last month. The jobless rate edged down 0.1 percentage point to a 2-month low of 4.4%. Employment reversed April’s 40.7k slump with a rise of 40.3k, and labor market participation ticked up from April’s 5-month low of 66.6% to 66.7%.
Hong Kong’s trade deficit in January-May of HKD 241.4 billion was roughly twice as wide as in the first five months of 2025.
The final estimated annualized growth of U.S. real GDP between 4Q 2025 and last quarter was 2.1%, revised upward from 1.6% estimated a month ago but close to the initial estimate of 2.0%. Growth in the quarter was powered by business investment in AI, followed by a post-shutdown rebound in government spending. Personal consumption limped only 0.5% higher, and net foreign demand exerted a 0.4 percentage point drag on GDP growth. Set against a 0.6% GDP contraction in the first quarter of 2025, year-on-year growth of 2.7% was at a 6-quarter high and above 2.0% recorded in the final quarter of 2025.
U.S. personal income in May jumped 0.7% following no change in April. Personal consumption expenditures also rose 0.7% nominally but 0.3% in real inflation-adjusted terms. Inflation measured by the PCE price deflator accelerated to a 37-month high of 4.1% and to 3.4% excluding food and energy, which is the favored measure that guides Federal Reserve policy. The Fed’s targeted inflation rate is well below that figure oat 2.0%.
Further evidence that the labor market will not be the Fed’s priority in 2026 in the period ahead came from last week’s new jobless insurance claims, which dropped back to a four-week low of 215k from 227k in the week of June 13. Other U.S. data out this morning were the Chicago Fed National Activity index, which fell back to a 2-month low of -0.10 in May from +0.19 in April, and an as-expected 4.5% drop in durable goods orders, which reversed half of April’s 8.5% surge. Year-to-date, orders were up by a robust 6.2% versus the first five months of 2025.
Copyright 2026, Larry Greenberg. All rights reserved.
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