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A sigh of relief, as it could have been worse given the Markit  services PMI. The ISM Non-Manufacturing PMI came out at 53.4 points, within expectations. However, the employment component fell to negative territory: 49.7 points, worse than 52.1 in January. This casts a shadow on the NFP.

The dollar enjoyed some bids, but this was short-lived. The Markit figure triggered a big USD sell-off.

The US ISM Non-Manufacturing PMI was expected to slip to 53.2 points in February. In January, this services sector measure fell to 53.5 and it hurt the dollar quite a lot. This is also a big hint towards tomorrow’s Non-Farm Payrolls.

The US dollar was on the back foot towards the publication.

Data (updated)

  • ISM Non-Manufacturing PMI: previous 53.5, expected: 53.2, actual: 53.4, within expectations.
  • Employment Component: Falls to 49.7, in contraction territory, quite worrying  
  • New orders tick down from 56.5 to 55.5
  • Business activity is up quite sharply from 53.9 to 57.8.
  • Prices are down to 45.5, the lowest since 2009.More here.
  • Factory Orders: prev. -2.9%, exp. +2%, actual: +1.6%.
  • Markit Final Services PMI:  prev. 49.8, exp. 49.8, actual 59.7 – this was a big warning sign for the ISM number.
  • Jobless claims (earlier): prev. 272K, exp. 271K, actual: 278L

Currencies

  • EUR/USD traded just above 1.0920, rising from the lows seen after the poor inflation figures early in the week.After a dip, EUR/USD extends its gains to 1.0937 and then slides. It’s a messy market out there.
  • GBP/USD traded at  1.4130, despite a third disappointing PMI. Cable moves around and slides to 1.4120.
  • USD/JPY fell under 114 to around 113.80. In the aftermath it is around 113.60 with choppy trading.
  • USD/CAD was around 1.3450 as oil prices slid from the highs. A further slide was halted.
  • AUD/USD felt comfortable on high ground, around 0.7340.The pair holds its ground.
  • NZD/USD ticked above 0.67. The kiwi is slightly higher.

Tomorrow’s  Non-Farm Payrolls report is now the main event.

See how to trade the NFP with EUR/USD

EURUSD March 3 2016 on ISM Non Manufacturing PMI