3 May 2016
US: Weak ISM manufacturing led to Dollar weakness – Deutsche Bank
Research Team at Deutsche Bank, notes that the main contributor to that weakness for the Dollar was the US ISM manufacturing data.
Key Quotes
“The reading printed at 50.8 in April which is down a full point from March and more than what the market had expected (consensus expectation was for 51.4). The print also matched the manufacturing PMI after there was no change in the final revision. In terms of the details, the new orders component declined 2.5pts to 55.8 although that is still well above where it printed in December at 48.8.
Employment rebounded 0.9pts to 49.2 but still remains in contractionary territory, while inventories declined 1.5pts to 45.5. A positive aspect of the data was the second consecutive print above 50 for new export orders (+0.5pts to 52.5) and in turn marking the best level since November 2014, indicating some stabilisation and positive feed through from the weakness in the currency.
We’ll get the ISM non-manufacturing data tomorrow but it’s worth mentioning that the spread between the two series got back to 2.7pts last month which was the least since December 2014. The current market consensus for this month’s nonmanufacturing print is 54.8 which implies a spread of 4pts however. If correct, that will be the most since January.”
Key Quotes
“The reading printed at 50.8 in April which is down a full point from March and more than what the market had expected (consensus expectation was for 51.4). The print also matched the manufacturing PMI after there was no change in the final revision. In terms of the details, the new orders component declined 2.5pts to 55.8 although that is still well above where it printed in December at 48.8.
Employment rebounded 0.9pts to 49.2 but still remains in contractionary territory, while inventories declined 1.5pts to 45.5. A positive aspect of the data was the second consecutive print above 50 for new export orders (+0.5pts to 52.5) and in turn marking the best level since November 2014, indicating some stabilisation and positive feed through from the weakness in the currency.
We’ll get the ISM non-manufacturing data tomorrow but it’s worth mentioning that the spread between the two series got back to 2.7pts last month which was the least since December 2014. The current market consensus for this month’s nonmanufacturing print is 54.8 which implies a spread of 4pts however. If correct, that will be the most since January.”