Daily Briefing, July 3 – Brace Yourselves for US ADP and ISM Manufacturing
Arslan Butt • 2 min read
Good morning, traders.
We’re already in the middle of the week, and so far the market has treated us well as we are in green. The Greenback struggled for traction on Wednesday as dimming expectations for any near-term Sino-US trade deal renewed safe-haven demand and sent US bond yields to their lowest levels since late 2016.
Today, investor focus shifts to the advance NFP & ISM manufacturing data from the United States. Are you ready to trade it?
Watchlist – Top Economic Events Today
Euro – Services PMI Figures
The European economy is due to release a series of economic events which includes:
Spanish Services PMI – The figure is scheduled at 07:15 GMT with a forecast of 52.7 vs. 52.8 during the previous month.
Italian Services PMI – Likewise, Italian Services PMI is due at 07:45 GMT with a neutral forecast of 50. Data below this level may drive selling in Euro and vice versa.
French Final Services PMI – The French services PMI will be observed at 07:50 GMT. It’s also expected to two show no change and stay at 53.1 vs. 53.1 previously.
GBP – Services PMI
At 08:30 GMT, the Markit will be releasing the services PMI data for the British economy. The British pound has gained some ground last week, partially due to a more friendly tone on Brexit by the two candidates aiming to become Prime Minister, but lately, the bullish trends have reversed.
In the economic realm, the PMI surveys for June will be released today for service sectors – but as usual, the currency will probably respond mainly to politics. Anyhow, the services PMI isn’t expected to show any change but could remain steady at 51.0 like last month.
USD – ADP Nonfarm Employment Change
The ADP (Automatic Data Processing) is also known as an advance NFP. It shows an estimated change in the number of employed people during the previous month, excluding the farming industry and government. The Automatic Data Processing, Inc. releases the figure in the first week of a new month, particularly on Wednesday.
Typically, the ADP figures offer a signal about the Nonfarm payroll figures, whether it’s going to be positive or negative, which is why both data share a positive correlation.
The ADP nonfarm employment change is due at 12:15 GMT. The US session will kick off with the ISM Non-Manufacturing PMI along with the private ADP jobs figures for the same month. Forecast for advance NFP was 140K vs. 27K last month. The dollar may gain some support ahead of the news, as traders typically price in the positive predictions.
USD – Crude Oil Inventories
At 14:30 GMT, it’s worth monitoring the Energy Information Administration’s crude oil inventories. Economists are expecting a draw of -2.8M vs. -12.8M barrels which can extend slight support to the commodity.
Good luck for today and stay tuned to FX Leaders for more updates.