The ISM Non-Manufacturing PMI came out just above expectations at 56.7 points. However, the employment component fell sharply from 55.7 to 51.6 points – an ominous sign for the NFP. New orders are up to 59.5 and prices are down to 45.5 points.
The US ISM Manufacturing purchasing managers’ index was expected to tick up to 56.6 points in January after 56.2 in December. This sector, the services one, is the largest in the US. The employment component is a key hint towards the Non-Farm Payrolls report on Friday.
The dollar was recovering towards the release and is looking for a direction afterwards.
Markit’s final services PMI was upgraded from 54 to 54.2 points, just below 54.3 expected.
Earlier, ADP NFP missed with 213K, but an upwards revision to December’s data balanced it. The miss was not too bad in comparison to other US disappointments of late. For example, the ISM Manufacturing PMI released on Monday was much more worrying, and so were factory orders, durable goods orders and Q4 GDP.
Despite many US misses, the most important figures related to jobs and core inflation are OK.
The dollar suffered a significant correction with the factory orders plunge serving as the straw that broke the camel’s back.
More: EUR: No Change In Trend; GBP: A Buy On Dips – Credit Agricole
