U.S. Dollar Drops After Weak ISM Services Data
05 März 2024 - 1:22PM
RTTF2
The U.S. dollar depreciated against its major counterparts in
the New York session on Tuesday, as weaker-than-expected ISM
services PMI for February increased chances of a rate cut in
June.
The ISM said its services PMI fell to 52.6 in February after
climbing to 53.4 in January. While a reading above 50 still
indicates growth, economists had expected the index to show a more
modest decrease to 53.0.
The Commerce Department also released a report showing a steep
drop in new orders for U.S. manufactured goods in the month of
January.
Investors looked ahead to key economic data and Federal Reserve
Chair Jerome Powell's semiannual testimony for more clues on
interest rate outlook.
Powell will testify before the House Financial Services
Committee on Wednesday and the Senate Banking Committee on
Thursday.
The U.S. Labour Department's employment report is due on Friday,
with employment expected to increase by 200,000 jobs in February
after an increase of 353,000 jobs in January.
The greenback fell to near a 2-week low of 1.0876 against the
euro, near 5-week low of 1.2734 against the pound and a 5-day low
of 149.70 against the yen, off its previous highs of 1.0840, 1.2671
and 150.54, respectively. The greenback is seen finding support
around 1.10 against the euro, 1.31 against the pound and 146.00
against the yen.
The greenback edged down to 0.6520 against the aussie and 0.6110
against the kiwi, from its early nearly 3-week highs of 0.6477 and
0.6071, respectively. The currency may locate support around 0.69
against the aussie and 0.64 against the kiwi.
The greenback touched 1.3555 against loonie, down from an early
6-day high of 1.3605. If the greenback falls further, it is likely
to test support around the 1.30 region.
The greenback weakened to 0.8825 against the franc, reversing
from an early 4-day high of 0.8866. The greenback is poised to
challenge support around the 0.84 level.
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