U.S. ISM Non-Manufacturing Purchasing Managers Index (PMI) was published higher than the forecastsadmin 11 December 2022
The Institute for Supply Management (ISM) Non-Manufacturing Purchasing Managers’ Index (PMI), also known as the ISM Services PMI, is a business report which is calculated as an indicator of the overall health of the non-manufacturing economy. These indicators include business activity, new orders, employment, and deliveries by suppliers.
A reading above 50% indicates that the non-manufacturing sector economy is generally expanding; a reading below 50% indicates that the non-manufacturing sector is generally contracting. ISM non-manufacturing sector report on trade is based on data compiled from the monthly responses of more than 370 purchasing, supply and utilization managers in more than 62 different industries.
The U.S. Purchasing Managers Index for the services sector was 56.5 at 6:30 p.m. on Dec. 5, 3 points above expectations. The index had been 54.4 the previous month.
Following the release of a better-than-expected U.S. purchasing managers’ index for the services sector in Nov the U.S. dollar index (DXY) held around the 106.65 mark in Asian markets on Wednesday, rising for the third consecutive day amid mixed data. On Christmas and New Year holidays and in the absence of major economic news this week, the dollar reached its highest level in a week against the basket of six major currencies.
However, last week’s higher U.S. employment data and Monday’s stronger ISM services PMI seem to be attracting a lot of attention, so the Fed is expected to keep interest rates on hold next, which in turn favors bullish DXY traders. In addition, warnings from several U.S. banks of poor economic conditions and weak earnings weighed on market sentiment and kept the U.S. dollar steady. In addition, Bloomberg Economics forecast economic growth of 2.4% in 2023, the lowest since 1993.
On the other hand, S&P 500 Futures rose near 3,950 and the yield on the 10-year U.S. Treasury bond reached 3.54 percent after Wall Street and major government bonds underperformed yesterday. We will have to wait and see if the DXY stays on the bullish radar as traders hope the Fed stays away from the pivot. However, the release of news from China and the lack of talk from the Federal Reserve could limit the movement of the U.S. dollar index ahead of next week’s Federal Open Market Committee (FOMC) meeting.