The Composite Purchasing Managers Index (PMI) approached the threshold of contraction as activity stagnated across the private sector.
Highlights
On August 23, S&P Global released U.S. PMI reports showing a decline in various sectors. Manufacturing PMI dropped from 49 in July to 47 in August, below analyst expectations of 49.3. A number below 50 indicates a contraction. Additionally, Services PMI decreased from 52.3 in July to 51 in August, while analysts had predicted a smaller drop to 52.2. Composite PMI fell from 52 to 50.4.
According to S&P Global, U.S. firms experienced a slower rise in output in August, with activity approaching stagnation across the private sector. Manufacturing entered contraction again due to falling production, while service providers reported the slowest growth since February.
The PMI reports in the EU and UK also showed weakness, leading to a decline in Treasury yields and signaling economic pressure. Consequently, the likelihood of another interest rate hike from the Federal Reserve diminished.
Despite the pullback in Treasury yields, the U.S. dollar remained relatively stable against a basket of currencies, with the U.S. Dollar Index consolidating close to the key resistance level at 103.65.
The decrease in yields provided support to precious metals markets, as gold rebounded above $1915 and silver rallied above $24.00.
At the start of the trading session, stock traders demonstrated a bullish sentiment, with the S&P 500 surpassing the 4400 level and the NASDAQ climbing above 15,000.
Subscribe to our daily newsletter and get the best forex trading information and markets status updates
Trade within minutes!
Comment (0)