Summary:

  • ISM manufacturing PMI comes in at joint highest since 2004
  • Print of 60.8 vs 58.7 exp and 59.1 prior
  • USD extends recent gains

There’s been more strong data from the world’s largest economy this afternoon with the latest manufacturing survey beating forecasts shortly after initial jobless claims fell to their lowest level since 1969. The ISM manufacturing PMI rose in the month of February to come in at 60.8 – the same level as September last year and the joint highest reading since 2004. Against a consensus forecast for 58.7 today’s number is a positive beat and suggests that the sector is in rude health. 

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 The latest ISM manufacturing reading rose once more and indicates that the sector is performing very well. Source: XTB Macrobond

A closer look at some of the sub-components of the survey also reveals several more areas of possible strength for the US dollar. First off the employment index rose to 59.7 vs 54.2 prior whilst the prices paid increased from 72.7 to 74.2 – the highest level since May 2011.

Unsurprisingly the buck has reacted positively to the release, with the USDIDX hitting a 7-week high and closing in on the 91 handle. A daily close above 90.70 would provide further evidence that the market is gaining traction with 91.55 the next level to look to on overhead. 

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 The USD index has hit a 7-week high after the data and is looking to make a concerted move higher. Source: xStation

The impact of the release can also be seen in the price of Gold, with the precious metal falling back to test the 1300 level. A technical overview for Gold can be found here.