Good news from the US: the ISM Non-Manufacturing PMI rises to 59.6 points – the highest since August 2005 – 9 full years. The employment component rose from 56.1 to 57.1 points. This raises expectations for a strong result tomorrow in the NFP. It is the highest employment component since February 2006, also the timing of the record for jobless claims.
After the publication, EUR/USD further slides and gets closer to 1.30. GBP/USD is marginally lower and USD/JPY reaches 105. Before the publication, EUR/USD traded around 1.3015, GBP/USD around 1.6430 and USD/JPY just under 105.
Details: the new orders component slid to 63.8, still reflecting strong growth. PRices paid also slid to 57.7 points.
The US ISM Non-Manufacturing purchasing managers index was expected to tick down to 57.3 points in August from 58.7 in July.
This indicator is very important towards the Non-Farm Payrolls tomorrow. There is a good correlation between the indicator and the result. Earlier in the day, the ADP figure came out below expectations at 204K while the manufacturing PMI surprised to the upside.
What NFP are we going to see? See how to trade the NFP with EUR/USD.
Earlier, Markit’s final services PMI for August was revised to the upside: from 58.5 to 59.5 points.
Was the dip below 1.30 a false break or is a second wave coming? In any case, here is the guide to the next levels for EUR/USD, below 1.30.Get the 5 most predictable currency pairs