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New York session traders seemed to be in a jolly mood with the Fourth of July holiday coming up as they allowed the Greenback to recover against most of its peers.

  • U.S. ISM manufacturing PMI up from 54.9 to 57.8 vs. 55.0 consensus
  • U.S. ISM manufacturing prices dipped from 60.5 to 55.0 vs. 58.5 forecast
  • U.S. total vehicle sales slid from 16.7M to 16.5M as expected
  • U.S. construction spending flat in May vs. projected 0.3% uptick
  • Canadian banks closed for the holiday

Major Events/Reports

U.S. manufacturing PMI

Stronger than expected results from the June ISM manufacturing survey was seen as the main reason for the dollar’s rebound in the latest U.S. session.

The headline reading jumped from 54.9 to 57.8 to reflect a much faster pace of industry expansion, outpacing the estimated rise to 55.0. Components of the report indicated that the prices sub-index fell from 60.5 to 55.0, underscoring weaker inflationary pressures likely due to lower oil prices, but that the employment sub-index advanced from 53.5 to 57.2 to signal a potential upbeat NFP reading for the month.

The components for new orders and production also posted robust gains, confirming that business activity picked up in June, while the index for inventories dipped slightly below 50.0 to signal that companies might need to increase output to refill depleted stockpiles.

However, the final manufacturing PMI reading from Markit in the same month was less upbeat as it dipped from 52.7 to 52.0, a downgrade from the flash reading of 52.1. Other medium-tier reports were also unimpressive, as the construction spending report printed a flat reading instead of the projected 0.3% uptick while total vehicle sales slowed from 16.7 million to 16.5 million.

U.S. equities closed mixed

Even though most U.S. traders were already off in the Hamptons prepping for the Fourth of July festivities, stock markets were still open for trading but there weren’t any fireworks.

  • S&P 500 index closed at 2,425.25 (+0.01%)
  • Nasdaq is down to 5,585.75 (-0.06%)
  • Dow 30 index is up to 21,479.27 (+0.61%)

Meanwhile, U.S. bond yields ticked higher as traders are starting to price in optimistic forecasts for the June NFP release, which might reinforce the Fed’s plan to hike interest rates one more time before the year ends.

  • U.S. 10-year yield up to 2.348% (+2.00%)
  • U.S. 2-year yield up to 1.414% (+2.03%)
  • U.S. 5-year yield up to 1.932% (2.36%)

Major Market Mover(s):


The scrilla kicked higher against its counterparts upon seeing stronger than expected ISM manufacturing PMI data.

USD/JPY continued to advance from 112.92 to a high of 113.46, EUR/USD slid to a low of 1.1354, GBP/USD retreated to the 1.2950 minor psychological mark, and USD/CHF is up to a high of .9643.


The yen continued its slide from earlier in the day as rising U.S. bond yields drew traders away from the lower-yielding currency.

EUR/JPY popped up from 128.40 to a high of 128.91, GBP/JPY rallied from 146.46 to 146.93, AUD/JPY is up to 86.91, and NZD/JPY climbed to a high of 82.83.

Watch Out For:

  • 2:30 am GMT: Australian retail sales m/m (0.2% expected, 1.0% previous)
  • 4:45 am GMT: RBA interest rate decision (Rates to stay on hold at 1.50%)
  • 6:00 am GMT: BOJ core CPI y/y (0.3% expected, 0.2% previous)