Weak PMI data will weigh on the USD – Scotiabank

FXStreet Insights Team FXStreet

USD mixed in quiet trade. Economists at Scotiabank analyze Greenback’s outlook.

Focus on PMI data in light session ahead

The US Dollar Index is trading slightly lower overall on the day and week and retains a generally soft undertone which leaves directional risks for the USD overall tilted to the downside still.

US trading desks will be lightly populated today and a quiet session is likely. But there is some data on tap in the form of S&P Global PMI data for the US. The preliminary November data are expected to reflect some slowing in US activity; manufacturing may slip back under 50 – if only barely – while the services and composite readings are expected to reflect slower expansion. Weak – or weaker than expected – data will weigh on the USD, given its soft undertone.

Author

FXStreet Insights Team

FXStreet

The FXStreet Insights Team is a group of journalists that handpicks selected market observations published by renowned experts. The content includes notes by commercial as well as additional insights by internal and external analysts.

Markets move fast. We move first.

Orange Juice Newsletter brings you expert driven insights - not headlines. Every day on your inbox.

Editor's Picks

EUR/USD drops to daily lows near 1.1630

EUR/USD now loses some traction and slips back to the area of daily lows around 1.1630 on the back of a mild bounce in the US Dollar. Fresh US data, including the September PCE inflation numbers and the latest read on December consumer sentiment, didn’t really move the needle, so the pair is still on course to finish the week with a respectable gain.

GBP/USD trims gains, recedes toward 1.3320

GBP/USD is struggling to keep its daily advance, coming under fresh pressure and retreating to the 1.3320 zone following a mild bullish attempt in the Greenback. Even though US consumer sentiment surprised to the upside, the US Dollar isn’t getting much love, as traders are far more interested in what the Fed will say next week.

Gold makes a U-turn, back to $4,200

Gold is now losing the grip and receding to the key $4,200 region per troy ounce following some signs of life in the Greenback and a marked bounce in US Treasury yields across the board. The positive outlook for the precious metal, however, remains underpinned by steady bets for extra easing by the Fed.