Markit, ISM to round out US April PMI on Monday
The US service economy takes centre stage Monday, giving investors a closer look at business activity in the country’s non-manufacturing industries. Markit Group and the Institute for Supply Management are scheduled to release April’s purchasing managers index for the services sector.
The readings could show the service economy expanded sharply in April.
The ISM reading is based on a survey of more than 375 US firms. Markit’s gauge is based on a survey of over 400 US companies.
March witnessed a strong rebound for service providers, who were still recovering from the weather-induced slowdown that dampened US recovery this winter. Improving domestic demand resulted in a sharp increase in overall business activity, Markit reported last month. However, the pace of new business growth fell to the lowest level in a year-and-a-half, supporting the view the service economy would need time to accelerate after a weak quarter.
ISM reported last month 13 of 18 non-manufacturing industries expanded in March, led by agriculture, forestry, fishing and hunting, transportation and warehousing, and construction. Employment rebounded sharply after falling for the first time in more than two years, ISM data showed.
The US dollar was subdued for most of the week, a sign investors were still trading cautiously amid all the uncertainty facing the US economy. Friday’s nonfarm payrolls report confirmed the US economy was regaining momentum at the start of the second quarter, giving investors more confidence to bid up the US dollar. Heading into next week, investors should be more willing to support the greenback if economic data reinforces the view recovery is on track.
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