- USD rising higher despite ISM manufacturing falling further than forecast
- GBPUSD break potentially key support as UK manufacturing hits 17-month low
- EURUSD moves back below 1.20
- CAD moves higher as GDP beats forecasts
- US stocks trade lower; Sell in May and go away?
The ISM manufacturing PMI for April dipped to 57.3 from 59.3 against consensus forecast for a 58.4 reading, with the number being the lowest for this economic indicator since last July. Despite this miss the US dollar is making more headway today and pushing down the price of Gold which has fallen close to the $1300/oz level.
The GBPUSD has suffered a double whammy with the rise in the buck adding to some weakness in the pound after UK manufacturing fell to its lowest level in 17 months. May rate hike odds have completed a stunning u-turn in the past couple of weeks and it now appears highly unlikely we get an increase at next week’s meeting. The reading itself came in at 53.9 against consensus forecasts for 54.8. This is the lowest print since December 2016 and marks a fairly sizable drop from 55.1 seen last time out.
Another USD pair that has made significant moves is the EURUSD which has dipped back below the 1.20 handle. The most widely traded FX pair has fallen to its lowest level since mid-January. Last week’s ECB meeting failed to provide enough for the bulls to hold above key support around 1.2155 and the market has since continued lower.
According to the latest figures the Canadian economy bounced back from a disappointing drop in economic growth last month, with a higher than forecast increase in February. The GDP M/M figure came in at +0.4%, above the +0.3% seen in January and a marked improvement on the prior print of -0.1%. The Canadian dollar has been having a fairly good run of it of late, although this has largely gone unnoticed due to the resurgence of the buck and the weakness seen in the GBP and EUR currencies.
The old trading adage "sell-in-May-and-go-away" is well known and widely quoted, but how much truth is in it? With US stocks beginning the month in the red we look back at previous performance in the month of May whilst also previewing tonight’s earnings release from Apple.
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