US: Markit Manufacturing PMI drops to 50.8 (preliminary) in February vs. 51.5 expected


The economic activity in the US manufacturing sector in February is expected to expand at a softer pace than it did in January with the IHS Markit's Manufacturing PMI dropping to 50.8 in its advanced print from 51.9 in January. This reading came in worse than the market expectation of 51.5.

Additionally, the IHS Markit's Services PMI dropped below the 50 mark in February to point to a contraction in the sector's activity. At 49.4, the Services PMI recorded its lowest reading in more than six years. Finally, the Composite PMI fell to 49.6 from 53.3.

Commenting on the data, “with the exception of the government-shutdown of 2013, US business activity contracted for the first time since the global financial crisis in February," noted Chris Williamson, Chief Business Economist at IHS Markit. "Weakness was primarily seen in the service sector, where the first drop in activity for four years was reported, but manufacturing production also ground almost to a halt due to a near-stalling of orders."

According to Williamson, the deterioration in part was caused by the coronavirus outbreak's negative impact on the demand across sectors such as travel and tourism, as well as on exports and supply chain disruptions. 

USD reaction 

The greenback came under heavy selling pressure following the disappointing PMI data. The US Dollar Index, which touched a fresh multi-year high of 99.91 on Thursday, was last seen erasing 0.45% on the day at 99.43.

Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.

Feed news

FXStreet Trading Signals now available!

Access to real-time signals, community and guidance now!


Latest Forex News

Editors’ Picks

GBP/USD attempts recovery amid as Johnson's condition is in focus

GBP/USD is trading above 1.23 as the focus remains on PM Johnson's condition. The 55-year old is in intensive care, receiving oxygen and Foreign Secretary Raab is in charge.

GBP/USD News

EUR/USD rises toward 1.09 amid a better market mood

EUR/USD is trading closer to 1.09, up amid falling coronavirus cases in the old continent and as German industrial output beat expectations with 0.3% for February. New US fiscal stimulus is also eyed.

EUR/USD News

Crypto starship starts the engines, pointing beyond limits

The bullish scenarios are fulfilled and bring the Top 3 to the launch pad. Ether's dominance shoots up and improves by more than 10% in a single day. The movement shows strong potential not seen since the 2017 bump.

Read more

Gold corrects from multi-week tops, slides further below $1650 level

Gold finally broke down of its Asian session consolidation phase and dropped to fresh session lows, around the $1645 region in the last hour.

Gold News

WTI stays relatively calm near $27 as markets wait for fresh clues on output cuts

Crude oil prices started the week on the back foot with the barrel of West Texas Intermediate (WTI) erasing 8.75% on a daily basis to close at $26.28.

Oil News

Forex MAJORS

Cryptocurrencies

Signatures