The ISM Non-Manufacturing PMI (Purchasing Manager Index) is based on a survey of purchasing managers in sectors other than manufacturing. Respondents are surveyed for their view of the economy and business conditions in the US. This important economic indicator is released during the first week of every month.
Here are all the details, and 5 possible outcomes for EUR/USD.
Published on Tuesday at 14:00 GMT.
Market analysts are always interested in the views of purchase managers on the economy, as the latter are considered to be attuned to the latest economic and financial developments, and their expectations could be an indication of the health of the economy.
The PMI continues to point to expansion in the services sector. Last month, the index came in at 56.0 points, very close to the estimate of 56.2 points. Little change is expected in the July release, with an estimate of 56.6 points.
Sentiments and levels
Although the euro is trading at lower levels, inflation remains too far from the ECB’s target. And while it takes time for June’s wide measures to kick in, Mario Draghi may decide not to wait and try to talk the euro down in various ways, as that would certainly help in achieving his mission. In the US, the excellent data that we’ve received is likely to keep the dollar bid for quite some time, even though there is no timetable as to when the US rate hike will actually occur. Thus, the overall sentiment is bearish on EUR/USD towards this release.
Technical levels, from top to bottom: 1.3585, 1.3550, 1.35, 1.34, 1.3325 and 1.3295.
- Within expectations: 54.0 to 59.0: In such a case, EUR/USD is likely to rise within range, with a small chance of breaking higher.
- Above expectations: 59.1 to 63.0: An unexpected higher reading can send the pair below one support line.
- Well above expectations: Above 63.0: Such an outcome could result in the pair breaking below a second support line.
- Below expectations: 50.0 to 53.9: A weak reading could lead to EUR/USD breaking above one resistance line.
- Well below expectations: Below 50.0: A reading close to or below 50, which marks contraction, could result in the pair pushing below a second support level.
For more about the EUR, see the EUR/USD forecast.
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