Dollar Forex Market Remains Lower Ahead of ISM Data
The USD/JPY pair is set to open lower today, as the Wall Street Journal reports that the ISM manufacturing index is scheduled to decline again. The ISM report, which tracks business activity in the manufacturing sector, is due out tomorrow.
The Dollar Forex Market Remains Lower Ahead of ISM Data
The dollar broke through a key support level on Friday, but it remains sharply lower against its rivals after the US’s leading manufacturing index fell short of expectations.
Pound and euro rise while dollar stays in negative territory
Focus on manufacturing PMIs
Markets fall, but oil prices may recover
A busy week in the forex market with important data releases begins today with the ISM Services PMI in the US. This may put the USD in a weaker position after last week’s NFP figures exceeded expectations. At the same time, it provided the pound and the euro with the strength they so desperately needed. Wall Street is expected to open the week shorter than usual and without much movement, although oil prices will be closely watched following the cancellation of OPEC+ production level talks.
book strengthened asrelaunch progresses
The British pound was viewed with optimism by those who trade the currency as the full reopening and lifting of all restrictions imposed by COVID-19 is imminent. The day, which has already been postponed once, has been named Freedom Day and is now set for July 19, despite ongoing concerns over the number of coronavirus cases in the country.
The weakening of the US dollar following the publication of NFP data late last week also proved beneficial, particularly for the pound. This weakness has been taken advantage of, as many are not looking at COVID concerns, but a strong economic recovery. The GBP/USD pair recently broke through the 1.39 level for the first time after a period of decline. Positive purchasing managers’ indices also allowed the euro to benefit from the weakening of the dollar and approach the 1.19 mark.
Data will be critical this week
This week will see the release of important data that forex brokers are sure will move the market in one direction or another. The first of these indicators is the ISM services index in the United States. The index is expected to be 63.5 in June, down 0.5 from the previous month.
Any deviation from these expectations could trigger a move in the US dollar, with a rate hike sure to put pressure on the Fed to consider a reversal of its inflation policy. In addition, key data will be released on Wednesday with the release of the FOMC meeting minutes.
Oil prices are closely monitored
The OPEC+ group, as it is often called, remains at an impasse over proposals to increase production. The vote showed that production should be increased by about 2 million barrels per day between August and the end of the year. This proposal was rejected by the United Arab Emirates, which continues to oppose the idea.
This led to the cancellation of the meeting and left oil prices in limbo over the weekend. The expected result could lead to higher prices in the short term, at least until the production problems are solved. Some analysts say this could push prices up to $100 a barrel.The USD/JPY pair has lost its footing earlier today following severe sell-off in two of its major competitors. The GBP/JPY pair is currently trading in a very tight range, and the EUR/JPY pair has been leading this week’s decline, with a break below 1.1600 expected today. A break below 1.1250 means that the pair is likely to continue its steady decline.. Read more about types of forex market and let us know what you think.
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