Asian Session – Dollar soft after US PMI data highlight growth concerns
March 25, 2014 7:31 am
Purchasing Managers Index data dominated the markets’ focus. There was particular attention on the US data which showed manufacturing activity in the world’s largest economy slowed in March after nearing a 4-year high in February.
The dollar was softer and US equity markets on Wall Street were lower in reaction to the disappointing data. The headline PMI reading showed a slower acceleration in manufacturing activity in the US economy in March, dipping to 55.5 from February’s 57.1.
Other PMI data released on Monday also had lingering effects on markets on Tuesday. China produced weaker-than-expected readings, as the flash Markit/HSBC PMI declined to an 8-month low of 48.1 in March from February’s final reading of 48.5. A number below 50 indicates contraction and the index has been below 50 since January.
Meanwhile, PMIs from Europe were mixed but only briefly dented the euro, which has since recovered and reclaimed the 1.38 handle. Focus now turns to the German Ifo data on German business morale, due later today. Other data to focus on will be UK inflation numbers and US new home sales.
The euro was little changed in the Asian session at 1.3830, up 0.2% since the start of trading on Monday. Sterling barely moved against the dollar in Asia today and traded at 1.6490. Against the yen, the dollar traded a tight range in Asia, ending at 102.24, compared to Monday’s high of 102.63. The Australian dollar rose to as high as 0.9156 in Asia, its highest level since December.
Purchasing Managers Index data dominated the markets’ focus. There was particular attention on the US data which showed manufacturing activity in the world’s largest economy slowed in March after nearing a 4-year high in February.
The dollar was softer and US equity markets on Wall Street were lower in reaction to the disappointing data. The headline PMI reading showed a slower acceleration in manufacturing activity in the US economy in March, dipping to 55.5 from February’s 57.1.
Other PMI data released on Monday also had lingering effects on markets on Tuesday. China produced weaker-than-expected readings, as the flash Markit/HSBC PMI declined to an 8-month low of 48.1 in March from February’s final reading of 48.5. A number below 50 indicates contraction and the index has been below 50 since January.
Meanwhile, PMIs from Europe were mixed but only briefly dented the euro, which has since recovered and reclaimed the 1.38 handle. Focus now turns to the German Ifo data on German business morale, due later today. Other data to focus on will be UK inflation numbers and US new home sales.
The euro was little changed in the Asian session at 1.3830, up 0.2% since the start of trading on Monday. Sterling barely moved against the dollar in Asia today and traded at 1.6490. Against the yen, the dollar traded a tight range in Asia, ending at 102.24, compared to Monday’s high of 102.63. The Australian dollar rose to as high as 0.9156 in Asia, its highest level since December.
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