The ISM non-manufacturing index edged back to 55.7 in May. Growth in current activity, new orders and employment moderated over the month, but remain at respectable levels. Price pressures are picking up.
Moderation to Still-Healthy Levels
- Activity outside the manufacturing sector increased at a slightly slower pace in May, with the index falling 2.1 points to 55.7.
- Growth in current activity and new orders slowed over the month, but at 59.5 and 57.9, respectively, remain at healthy levels. Backlogs of orders, however, contracted in May.
- Inflation pressures are firming, with the prices paid component rising to 55.9, its highest mark since August.
Hiring Still Looks Solid
- The employment index fell 1.4 points to 55.3. At face value, this would imply a softening in payroll growth, but with the manufacturing employment index rising, jobless claims hovering near 15-year lows, and consumers’ views of job availability improving, we look for job gains of around 216,000 on Friday.
- On an economy-weighted basis, the ISM indices continue to point to growth continuing at a decent clip.
Recommended Content
Editors’ Picks
EUR/USD clings to gains above 1.0750 after US data
EUR/USD manages to hold in positive territory above 1.0750 despite retreating from the fresh multi-week high it set above 1.0800 earlier in the day. The US Dollar struggles to find demand following the weaker-than-expected NFP data.
GBP/USD declines below 1.2550 following NFP-inspired upsurge
GBP/USD struggles to preserve its bullish momentum and trades below 1.2550 in the American session. Earlier in the day, the disappointing April jobs report from the US triggered a USD selloff and allowed the pair to reach multi-week highs above 1.2600.
Gold struggles to hold above $2,300 despite falling US yields
Gold stays on the back foot below $2,300 in the American session on Friday. The benchmark 10-year US Treasury bond yield stays in negative territory below 4.6% after weak US data but the improving risk mood doesn't allow XAU/USD to gain traction.
Bitcoin Weekly Forecast: Should you buy BTC here? Premium
Bitcoin (BTC) price shows signs of a potential reversal but lacks confirmation, which has divided the investor community into two – those who are buying the dips and those who are expecting a further correction.
Week ahead – BoE and RBA decisions headline a calm week
Bank of England meets on Thursday, unlikely to signal rate cuts. Reserve Bank of Australia could maintain a higher-for-longer stance. Elsewhere, Bank of Japan releases summary of opinions.