US ISM Non-Manufacturing PMI Overview
The Institute of Supply Management (ISM) will release the Non-Manufacturing Purchasing Managers' Index (PMI) - also known as the ISM Services PMI at 14:00 GMT this Wednesday. The gauge is expected to come in at 55 for July as compared to the previous month's big jump to a four-month high level of 57.1.
According to Joseph Trevisani, an analyst at FXStreet: “New orders are projected to rise to 64.7 in July from 61.6 in June which was the highest reading since February’s 63.1 and the second best outlook in a year. Employment is forecast to climb into expansion at 51.1 from 43.1 in June. The prices paid index is expected to be 64 in July up from 62.4 the previous month.”
How could it affect EUR/USD?
A weaker-than-expected reading will be enough to exert some additional pressure on the already weaker USD and possibly lift the EUR/USD pair back closer to the 1.1900 mark, or YTD tops set last Friday. Conversely, a stronger print might provide some respite to the USD bulls, albeit is unlikely to be a major game-changer. Investors are likely to refrain from placing any aggressive bets and prefer to wait on the sidelines ahead of the July Non-Farm Payrolls (NFP) on Friday.
Meanwhile, Yohay Elam, FXStreet's own Analyst outlined important support levels that could help limit any pullback for the EUR/USD pair: “Support awaits at 1.1780, a temporary cap on the way up, and 1.1730, a swing low last week. Critical support awaits at 1.17, which is a double-bottom, followed by 1.1625.”
Key Notes
• US Non-Manufacturing PMI July Preview: Second thoughts on the US economy
• EUR/USD Forecast: At an inflection points, three things to watch
• EUR/USD Price Analysis: Immediate hurdle lines up at 2020 highs
About the US ISM Non-Manufacturing PMI
The ISM Non-Manufacturing Index released by the Institute for Supply Management (ISM) shows business conditions in the US non-manufacturing sector. It is worth noting that services constitute the largest sector of the US economy and result above 50 should be seen as supportive for the USD.
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