In its ‘Flash U.S. PMI’ report, the IHS Markit said that the Manufacturing PMI in May dropped to 50.6 from 52.6 in April while the Composite PMI fell to 50.9 from 53. Both of these reading fell short of the market expectations and with the initial reaction the US Dollar Index retreated from the 2-year high that it set in the last hour at 98.37 and was last seen up 0.2% at 98.27.
Key takeaways from the press release
- The seasonally adjusted IHS Markit Flash U.S. Services PMI Business Activity Index posted 50.9 in May, down from 53.0 in April, to indicate a notable slowdown in service sector business activity.
- Chris Williamson, Chief Business Economist: “Growth of business activity slowed sharply in May as trade war worries and increased uncertainty dealt a further blow to order book growth and business confidence.”
- “The slowdown has been led by manufacturing, but shows increasing signs of spreading to services.”
- “Trade wars remained top of the list of concerns among manufacturers, alongside signs of slower sales and weaker economic growth both at home and in key export markets.”