Traders now await the release of PMI data from the United States economy, with Services and Manufacturing data the central data focus during the US session.
In reality, the downtrend in Manufacturing and Services has been a big theme as the economy sours. Most analysts are predicting that Manufacturing and Services data will slightly decline in June compared to the previous readings.
The S&P Global US Manufacturing PMI was revised slightly lower to 48.4 in May of 2023 from a preliminary of 48.5 driven by a solid contraction in new orders amid muted demand conditions.
Efforts to run down stocks were met by a steeper contraction in purchasing activity, hinting at lower production growth in the coming months. Sharply falling demand for inputs contributed to an unprecedented improvement in vendor performance.
For the record, the manufacturing sector dominates a large part of total GDP, the manufacturing PMI is an important indicator of business conditions and the overall economic condition in the United States.
Readings above 50 imply the economy is expanding, making investors understood it as a bullish for the USD, whereas a result below 50 points for an economic contraction, and weighs negatively on the currency.
We also see the release of Services data. The S&P Global US Services PMI was revised slightly lower to 54.9 in May of 2023 from a preliminary 55.1 but continued to point to the strongest expansion in the services sector since April 2022, mainly supported by new business.
The upturn in new orders was driven by improved demand conditions in both domestic and export markets. As the services sector dominates a large part of total GDP.
The services PMI is an important indicator of the overall economic condition in the United States. A result above 50 signals is bullish for the US dollar, whereas a result below 50 is seen as bearish.
