Summary:
- ISM non-manufacturing PMI 59.9 vs 56.5 exp and 55.9 prior
- Employment reading 61.6 vs 56.3 (highest since 1997)
- USD looking to build on recent gains
The main economic release of the afternoon has come in better than expected with the latest survey on the US services sector impressing. An ISM non-manufacturing PMI print of 59.9 was well above the 56.5 forecast and also the 55.9 prior. A closer look at the report reveals more good news for the world’s largest economy with the employment sub-component coming in at 61.6 vs 56.3 – the highest ever reading for this metric since records began in 1997.
The US dollar is making more gains after the data release with the GBPUSD one of the pairs showing this most clearly. Source: xStation
The strong data comes hot on the heels of Friday’s solid NFP report and has been warmly received by the US dollar. The Greenback managed to snap its losing streak last week, posting a gain after 7 straight weeks of declines and today’s data has seen the USD index move back near recent highs around 89.45.
The rise that began after Friday’s NFP has looked to continue today with 89.45 level to look for possible resistance. Source: xStation
Looking at specific USD pairs the GBPUSD is one to focus on this week with “Super Thursday” due to occur when the BoE will release their quarterly inflation report alongside their latest monetary policy. Aided by the strong NFP number the GBPUSD posted a bearish engulfing candlestick near to prior resistance around 1.4350 on Friday and the pair has continued lower this morning.Price fell below 1.40 earlier on but the prior support around 1.3980 held and this is now an area to keep a close eye on going forward.
GBPUSD has pulled back further today but is respecting prior support around 1.3980. Source: xStation