The US S&P PMI results for April were lower than predicted, prompting investors to drop the USD.
The US Dollar Index (DXY) is trading softly at 105.70, reflecting daily losses in Tuesday’s session. The Federal Reserve (Fed) has repeatedly sent hawkish signals. Which may limit the Greenback’s losses as markets delay the start of the easing cycle.
Investors are also keeping an eye on crucial economic indicators due this week.
Investors are also keeping an eye on crucial economic indicators due this week. Such as the preliminary figures of Q1’s GDP Growth Rate and Personal Consumption Expenditures (PCE) Price Index from March to acquire a better understanding of the economy’s health. During Tuesday’s session, S&P PMIs came in weaker than expected, putting the USD under pressure.
Despite the dismal PMIs, the US economy is overall resilient. The Fed’s position is hawkish. Resulting in lower odds of rate decreases in the near future and not until September. PCE and GDP statistics later this week are anticipated to drive market volatility. As they continue to shape expectations for the upcoming Fed decision.
Daily Market movers: US Dollar falls after dismal April S&P PMIs, hawkish bets on Fed.
The S&P Global Composite Purchasing Managers Index (PMI) dipped to 50.9 in April’s flash estimate. Reflecting slower private sector growth in the US compared to March’s The S&P Global Manufacturing PMI fell from 51.9 in March to 49.9 in April, indicating a decrease in US manufacturing activity.
Similarly, the April S&P Global Services PMI fell from 51.7 to 50.9.
Following the Federal Reserve’s (Fed) continuous hawkish stance on US monetary policy, the first rate cut has been pushed back to September, but it is still not completely priced in.
US Treasury bond yields are falling, with the 2-year yield at 4.93%, the 5-year yield at 4.61%, and the ten-year yield at 4.58%.
