US ISM Manufacturing is the Big Release This Week
The US Dollar has been pretty bullish since Spring of 2018, since the US economy was growing at the fastest speed and the FED was on a tightening cycle. The global economy has slowed down since then, but the US economy has been holding on better than other major/developed economies.
Although, that was put into question in September last year, when the ISM manufacturing report showed that this sector fell in contraction. This brought fears of a recession in manufacturing in the US, just like in the Eurozone. The USD turned pretty bearish after that report.
In October, we saw a slight improvement, but it remained in contraction nonetheless. Last month, the US ISM manufacturing was expected to improve again, but it fell deeper into contraction instead, which turned the Buck bearish again, on fears of a recession in manufacturing, since it has been contracting for the last four months.
So, today’s ISM report will be important for the USD. This report is expected to improve to 49.0 points for December, from 48.1 in November, but that would still mean contraction. Although, if we see another miss, traders would be disappointed and the fear of deeper contraction will kick in again, which would send the Buck lower. So, this report will be important and we will be covering it live in our forex economic calendar section.
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