DXY up slightly following the Fed’s decision to hold rates
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Daily Currency Update
The US Dollar Index (DXY) was up by around 0.08% this morning to 104.18 amid a mix of positive and negative data out of the US. The Institute for Supply Management (ISM) Manufacturing Purchasing Manager’s Index (PMI), which measures the prevailing direction of economic trends in manufacturing, came in lower than expected at 46.8 versus 48.8. Meanwhile, the ISM Manufacturing Prices data came in higher than expected at 52.9 instead of the expected 51.9. With this mixed data and the Federal Reserve’s decision to hold interest rates as expected, the USD moved very little. The USD was up versus EUR, CAD, and GBP so far today.Key Movers
In the Eurozone, the Final Manufacturing PMI data was released today. It came in slightly higher than expected at 45.8 versus the 45.6 that was anticipated. The EUR was down against the USD and CAD so far today.The GBP saw movement following the first reduction in interest rates from the Bank of England (BoE) since March 2020. The BoE decided to cut the official bank rate from 5.25% to 5.00%, as expected. After the rate cut, the GBP was down versus the EUR, USD, and CAD. GBP Final Manufacturing PMI was also released, coming in higher than expected at 52.1 versus 51.8.
The Canadian dollar was up against the EUR and GBP so far today following higher than expected Gross Domestic Product (GDP) yesterday. Canada’s May GDP data, which measures the monetary value of final goods and services, was reported to be stronger than expected, with a growth rate of around 2.2%. Markets will be looking ahead to trade balance data which will be released on Tuesday. West Texas Intermediate (WTI) crude oil was down so far today by around -0.35% to the 77.56 level.
Expected Ranges
- EUR/USD: 1.0777 - 1.0835 ▼
- GBP/USD: 1.2750 - 1.2862 ▼
- AUD/USD: 0.6513 - 0.6559 ▲
- USD/CAD: 1.3794 - 1.3836 ▲