US Dollar Rises Ahead of S&P Global PMI
The US dollar rose against its major trading partners early Friday ahead of the release of S&P Global’s flash readings for manufacturing and services conditions in June.
The dollar received some support from the dovish surprises by the Swiss National Bank and to a lesser extent the Bank of England yesterday, ING analyst Francesco Pesole said in a note.
When adding lingering EU political concerns, DXY may stay bid in the coming days, Pesole stated. A quick summary of foreign exchange activity heading into Friday showed that USDEUR fell to 1.0682 from 1.0707 at the Thursday US close.
The Eurozone manufacturing purchasing managers’ index declined further below the breakeven point that indicates contraction in June, while services PMI declined slightly but still signals expansion, data released overnight showed. The next European Central Bank meeting is scheduled for July 18.
GBPUSD fell to 1.2637 from 1.2664 at the Thursday US close and 1.2693 at the same time Thursday morning. UK manufacturing PMI rose slightly in June while services PMI declined, though both still pointed to expansion.
Also released overnight, UK retail sales rebounded more than expected in May after a decline in April. The next Bank of England meeting is scheduled for Aug. 1.
USDJPY rose to 159.0073 from 158.9014 at the Thursday US close and 158.4230 at the same time Thursday morning. Japanese manufacturing PMI declined in June but remained above the breakeven point while services PMI fell back into contraction.
Also released overnight, Japanese national consumer price inflation accelerated in May. The next Bank of Japan meeting is scheduled for July 30-31.
USDCAD rose to 1.3689 from 1.3683 at the Thursday US close but was below a level of 1.3708 at the same time Thursday morning. Canadian retail sales for April and industrial and raw materials prices for May are set to be released. The next Bank of Canada meeting is scheduled for July 24.
S&P Global PMIs aren’t as highly regarded as the ISM surveys in the US but have recently shown greater traction, especially for their comparability with the European figures, according to ING.
June PMIs are released today and are expected to ease moderately while staying well into expansionary territory (>50) in the US.
The leading index and existing home sales (both for May) complete the calendar and may come in soft. Pesole said in the note. Yesterday, there was a big drop in housing starts to 1277k from 1352k with building permits down heavily too. Fidelity Bank, FBNH Drive Intraday Gain on NGX
