US Dollar Rattled by Weak PMIs, US GDP and Core PCE Remain this Week’s Ke...

US Dollar Price, Charts, and Analysis

• US economical upturn ‘lost momentum’ astatine the commencement of Q2 – S&P Global.
• Official Q1 GDP is released connected Thursday, and Core PCE connected Friday.
• US dollar slips but the sell-off whitethorn beryllium short-lived.

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US concern enactment continued to summation successful April, but ‘the complaint of enlargement slowed amid signs of weaker demand’, according to the latest S&P Global Flash PMI report. All 3 readings deed multi-month lows, portion the Manufacturing PMI fell backmost into contraction territory. Commenting connected the data, Chris Williamson, Chief Business Economist astatine S&P Global Market Intelligence said:

“The US economical upturn mislaid momentum astatine the commencement of the 2nd quarter, with the flash PMI survey respondents reporting below-trend concern enactment maturation successful April. Further gait whitethorn beryllium mislaid successful the coming months, arsenic April saw inflows of caller concern autumn for the archetypal clip successful six months and firms’ aboriginal output expectations slipped to a five-month debased amid heightened interest astir the outlook.”

S&P Global Flash US PMIs – Full Report

Shorter-dated US Treasury yields determination little post-PMIs but stay astatine elevated levels. The rate-sensitive 2-year has tried, and failed, to interruption supra 5% successful the past fewer weeks arsenic US rate cut expectations are pared back. From the champion portion of 170 ground points of cuts forecast astatine the extremity of past year, the markets are present showing conscionable 44 ground points, with the archetypal quarter-point chopped seen astatine the September 18th FOMC meeting.

This week besides brings a full of $183 cardinal of new, shorter-dated US Treasuries to the market. Today sees $69 cardinal 2-years connected the block, portion $70 cardinal 5-years and $44 cardinal 7-years volition beryllium auctioned disconnected connected Wednesday and Thursday respectively. Any mediocre auction volition propulsion outstanding UST yields higher.

From a method angle, the US 2-year output illustration whitethorn beryllium making a bullish emblem enactment which if completed would suggest a re-test of the October 19th precocious astatine 5.26%.

UST 2-Year Yield Daily Chart

US dollar traders volition present beryllium connected alert for 3 large US information releases, US durable goods (Wednesday), US Q1 Flash GDP (Thursday), and US Core PCE connected Friday. All 3 are imaginable marketplace movers but it’s the past 2 that transportation the astir heft.

The US dollar scale is down a fraction post-PMIs but remains elevated. A interruption supra 106.58 would permission October’s precocious astatine 107.335 susceptible and would wholly retrace the July 2023 - December 2023 sell-off. All 3 elemental moving averages stay successful a bullish formation, portion the 50-/200-day bullish crossover made successful precocious March continues to steer the marketplace higher.

US Dollar Index Daily Chart

All Charts via TradingView

What are your views connected the US Dollar – bullish oregon bearish?? You tin fto america cognize via the signifier astatine the extremity of this portion oregon you tin interaction the writer via Twitter @nickcawley1.