"On the macro front, US data reinforced concerns about slowing economic momentum. The ISM Manufacturing PMI fell to 47.9 in December, marking a third consecutive month of deterioration and its lowest level since October 2024. The reading came in below expectations for a modest improvement and highlighted a faster pace of contraction in manufacturing activity, driven mainly by declines in production and inventories. While the employment component improved, it continued to signal a cooling labour market."
"Upcoming US data releases this week could remain in focus, including the JOLTS job openings report, the ISM Services PMI, and Friday's nonfarm payrolls. A continuation of soft data would likely reinforce expectations of a more dovish Federal Reserve stance in 2026, with markets currently pricing in two rate cuts by the end of the year. With both geopolitical uncertainty and domestic growth concerns in play, the markets could experience heightened volatility into the coming sessions as incoming data could further shape the policy outlook."
The US dollar showed volatility as investors balanced geopolitical tensions and disappointing US economic data. ISM Manufacturing PMI dropped to 47.9 in December, the third straight month of deterioration and the lowest since October 2024, driven by declines in production and inventories despite an improved employment component that still signaled labour-market cooling. Markets now await JOLTS, ISM Services, and nonfarm payrolls, with continued weak data likely to cement expectations of a more dovish Federal Reserve and two rate cuts priced for 2026. Combined geopolitical and domestic growth risks could raise near-term dollar volatility.
Read at London Business News | Londonlovesbusiness.com
Unable to calculate read time
Collection
[
|
...
]