Summary:
- ADP report shows small-than-expected increase in employment
- Non-manufacturing ISM declines to the lowest level since July 2017
- EURUSD moved higher following release of the ISM index
A few key readings from the US economy were released today and the picture presented is rather pessimistic. The ADP employment change report for June was released at 1:15 pm BST and it showed an increase of 102k. The reading can be called a disappointment as the market expected gain of 140k. However, the previous reading was revised higher from 27k to 41k. It was also the second report in a row that showed net lay-offs in the small business sector. Next, investors were offered final services PMI print for June and it diverged from the preliminary reading by quite a huge margin. Namely, the index was expected to remain at 50.7 pts signalled earlier but instead jumped to 51.5 pts. The non-manufacturing ISM index for June was published at 3:00 pm BST. The index declined more than expected - from 56.9 pts to 55.1 pts (expected 56 pts). In turn, the gauge has found itself at the lowest level since July 2017. Taking a look at subindices, one can see significant declines in employment, business activity and new orders. EURUSD moved higher following the release and may be set to take out a daily high at 1.13 handle in case the sentiment prevails.
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EURUSD moved sharply higher on the release of the non-manufacturing ISM index. However, the knee-jerk move was not strong enough to take out a daily high at 1.13 handle. Source: xStation5
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