Even though the latest batch of medium-tier data from Uncle Sam didn’t turn out so impressive, the Greenback still managed to squeeze out some gains against its peers.
- ISM manufacturing PMI down from 57.5 to 56.9 in May vs. 57.1 forecast
- U.S. final services PMI downgraded from 54.0 to 53.6
- U.S. unit labor costs up 2.2% vs. 3.0% consensus for Q1
- U.S. non-farm productivity flat in Q1 vs. projected 0.6% decline
- U.S. factory orders down 0.2% as expected
- Crude oil edged lower on Saudi-Qatar rift
Mostly downbeat U.S. data
Dollar traders seem to have come to terms with the fact that the U.S. economy ain’t as hot as it used to be, shrugging off the recent misses while still keeping their hopes up for a June hike.
The ISM non-manufacturing PMI fell from 57.5 to 56.9 to reflect a slower pace of industry growth versus the projected dip to 57.1. Underlying components indicated that new orders and prices decreased while employment ticked higher in May.The final services PMI, which is reported by another agency called Markit, was downgraded from the flash 54.0 figure to 53.6 instead of being upgraded to the consensus at 54.1.
Speaking of downgrades, the quarterly unit labor costs reading for Q1 2017 was also negatively revised from 3.0% to 2.2% while the non-farm productivity figure for the same period showed a flat reading. These both that there’s less upside pressure on wages, which could mean subdued inflation factors down the line.
- S&P 500 index is down 0.14% to 2,434.25
- Nasdaq is lower by 0.10% to 5,880.12
- Dow 30 index is down 0.10% to 21,184.04
Saudi-Qatar rift continues to weigh on oil
Black Crack kept edging lower throughout the day as traders tuned in to the drama between Saudi Arabia and Qatar. This rift could make it more difficult for the OPEC to enforce its output deal, which it has just recently decided to extend by nine months.
- U.S. WTI crude oil fell 0.52% to $47.41 per barrel
- Brent crude oil is down 0.86% to $49.52 per barrel
Major Market Mover(s):
The scrilla managed to pocket a few measly pips against most of its counterparts for the day as U.S. bond yields still closed higher despite downbeat data.
EUR/USD is down to 1.1255 (-0.21%), USD/CHF is up 27 pips to .9650 (+0.28%), USD/JPY is up from 110.39 to 110.47 (+0.08%), but GBP/USD held on to its lead by 17 pips (+0.13%).
Interestingly enough, the oil-related Loonie managed to make a bit of a rebound late in the day even with tensions in the Middle East.
USD/CAD is down to 1.3473 (-0.15%), CAD/JPY is up from 81.83 to 82.00 (+0.17%), and EUR/CAD is down 52 pips to 1.5165 (-0.34%).
Watch Out For:
- 12:01 am GMT: U.K. BRC retail sales monitor (5.6% previous)
- 1:00 am GMT: Japanese average cash earnings y/y (0.3% expected, 0.0% previous)
- 2:00 am GMT: New Zealand ANZ commodity prices (-0.2% previous)
- 5:30 am GMT: RBA interest rate decision (See Forex Gump’s preview here!)