The U.S. dollar turned in a mixed performance against its peers on Tuesday, as the currencies reacted to a slew of economic data from across the globe.
Data from Markit Economics showed that the IHS Markit U.S. manufacturing index in May was at 62.1 versus an initial 61.5.
Manufacturing activity in the U.S. expanded at a slightly faster pace in the month of May, according to a report released by the Institute for Supply Management.
The ISM said its manufacturing PMI inched up to 61.2 in May from 60.7 in April, with a reading above 50 indicating growth in the manufacturing sector. The uptick surprised economists, who had expected the index to come in unchanged.
The dollar index, which rose to 89.92, dropped to 89.66 by late morning before recovering to 89.90 again.
Against the Euro, the dollar firmed to $1.2218, recovering from $1.2256. Eurozone manufacturing activity expanded at a record pace in May despite supple bottlenecks, a separate survey showed.
IHS Markit’s final Manufacturing Purchasing Managers’ Index rose to a new record high of 63.1 in May from April’s 62.9. This was up from a preliminary 62.8.
The Pound Sterling was weak against the dollar, fetching $1.4148, nearly 0.5% less than the previous close of $1.4213. The UK manufacturing sector expanded at a record pace in May on stronger production growth and record gains in new orders, despite a surge in inflationary pressures.
The IHS Markit/CIPS UK Manufacturing Purchasing Managers’ Index (PMI) was finalized at 65.6 in May, up from April’s 60.9 as new work intakes rose at record rate.
The Yen was firmer at 109.48 a dollar, gaining from 109.58 a dollar.
The Aussie gained in strength, moving up 0.26% to US$0.7754. The Reserve Bank of Australia today kept the cash rate at a record low of 0.1%, as widely expected. Policymakers reaffirmed their commitment to maintaining highly supportive monetary conditions until at least 2024 when actual inflation is within the 2 to 3% target.
The Swiss franc gained against the dollar, firming to CHF0.8971 a dollar, gaining from CHF0.8989. Preliminary data from the Federal Statistical Office showed Switzerland’s retail sales increased in April, growing by 35.7% year-on-year.
The Loonie weakened to C$1.2073 a dollar, easing from C$1.2064, despite higher crude oil prices. Data released by Statistics Canada showed Canada’s GDP expanded 1.4% in the first quarter of 2021 after growing by a downwardly revised 2.2% in the previous quarter.
According to Markit Economics, the IHS Markit Canada Manufacturing PMI dropped to 57 in May of 2021 from 57.2 in the previous month. Still, the latest reading pointed to the 11th straight month of expansion in the country’s factory activity.
The material has been provided by InstaForex Company – www.instaforex.com