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The ISM Non-Manufacturing PMI for June disappointed with a drop to 52.2 points. It was expected to edge up from 53.7 to 54.3 points. The employment component is closely watched and it rose from 50.1 to 54.7 points. This is great news.

EUR/USD traded above the day’s lows at 1.2970, despite better than expected data earlier in the US.

The big disappointment came from the new orders component: it dropped from a strong 56 to 50.8 – very slow growth. Prices rose from 51.1 to 52.5 points – still showing growth despite fears of deflation.

The services sector is the largest in the US, and this indicator serves as an important hint towards the Non-Farm Payrolls. The ISM manufacturing PMI rose back to growth territory, to 50.9, but the employment component dropped to contraction territory, under 50, for the first time since September 2009 – a sign of worry.

Earlier, jobless claims came in at 343K, within expectations while continuing claims fell.

The more exciting news came from the ADP report: the US gained 188K private non-farm payrolls according to this publication. This is encouraging.

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