USDIndex, H1
The key US ISM Manufacturing Index slipped -0.2 points to 48.1 in November, disappointing expectations for a pop over the 50 mark. The Index had edged up 0.5 ticks to 48.3 in October. This is a fourth straight reading below 50. The Index was at 58.8 last November. The components were mostly weaker. The employment gauge fell 1.1 points to 46.6 from 47.7. New orders dropped 1.9 ticks to 47.2 from 49.1. New export orders declined -2.5 points to 47.9 from 50.4, while the import sub-index rose 3.0 points to 48.3 from 45.3. Prices paid were up 1.2 ticks to 46.7 from 45.5.
Earlier, the less significant US Markit manufacturing PMI rose to 52.6 in the final November print, versus the 52.2 preliminary, and the 51.3 in October. The index appears to have bottomed at 50.3 in August. It was at 55.3 last November. This is the best reading since April. The output component improved to 53.7 from October’s 52.4, and is the highest since January. New orders also rose to their peak since January. The data support the narrative of better than expected growth.
The USD weakened following the ISM data; USDIndex breached below 98.00, USDJPY dipped to 109.20 and below S2, as EURUSD continued its recovery and traded to 1.1065 and over R2 at 1.1053.
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Stuart Cowell
Head Market Analyst
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