- USD/CHF rebounds after falling to its lowest level in two months below 0.9600.
- US Dollar Index erases majority of daily losses ahead of American session.
- ISM Manufacturing PMI in the US is expected to improve to 43 in May.
The USD/CAD pair spent the second half of the previous week under bearish pressure and extended its slide on Monday to touch its lowest level since late March at 0.9579. However, the pair staged a rebound ahead of the American session and was last seen trading at 0.9612, where it was virtually unchanged on a daily basis.
With most major European markets closed in observance of Whit Monday, the USD’s performance remains as the sole driver of USD/CHF’s movements.
Focus shifts to US data, Wall Street
Last week, the US Dollar Index (DXY) lost 1.5% amid the upbeat market mood on easing coronavirus-related lockdown measures. Although the index continued to edge lower at the start of the new week, it recovered the majority of early losses as investors seem to be adopting a cautious mood ahead of key macroeconomic data releases. At the moment, the S&P 500 futures are flat on the day.
Moreover, the unrest that has spread across major cities in the US with mass protests and rioting could weigh on the sentiment and help greenback continue to find demand as a safe-haven.
At 1400 GMT, the ISM will release its Manufacturing PMI data, which is expected to show that the contraction in the sector continued in May albeit at a softer pace. Ahead of this data, the DXY is down 0.1% on the day at 98.18.