The purchasing managers’ index for the manufacturing sector in the US ticked up to 53.4 points from 52.4 last month. Early expectations stood on a rise to 53.3 points.
This is the first major indicator towards the highly anticipated Non-Farm Payrolls report on Friday. The employment component also rose nicely: from 53.2 to 56.1 points. While the figure was within expectations, it erases the doubts about the recovery so far.
While this figure is certainly encouraging for the NFP, it’s important to remember that the services sector is certainly much larger than the manufacturing sector.
Manufacturing has been in growth territory for 32 consecutive months, but growth hasn’t been significantly strong during this period of recovery.
New orders slid marginally from 54.9 to 54.5 points. Inventories ticked up from 49.5 to 50 points – at perfect balance now. Prices remain on the rise, at 61 points, yet a bit slower than last month’s 61.5 points.
EUR/USD remains range bound, but this figure certainly adds to downward pressure on the pair. Will it break support? For more on the pair, see the euro to dollar forecast.