The US Dollar has firmed in the wake of better-than-expected ISM manufacturing data, causing the Pound to retreat from the 27-month highs it reached earlier in the session. The Euro fell to a session low.
According to the Institute for Supply Management’s factory index output across the US increased to 57.3 in November, up from the previous months reading of 56.4. The figure beat economist forecasts for a decline to 55.1. The data also showed that manufacturing activity in the world’s largest economy expanded at its fastest pace since April 2011.
The positive data combined with the earlier Chinese, European and UK manufacturing reports to suggest that global factory output is steadily rising as the global economy continues to recover from the Great Recession.
The report also showed that both production and new orders rose by around 3 points to 62.8 and 63.6 respectively. The employment component of the index indicated some improvement in the labour market in November, rising by more than 3 points to 56.5. Any figure above 50 indicates expansion, whilst below indicates a contraction.
Against the Japanese Yen the US Dollar strengthened to a six-month high as demand for safe-haven assets weakened following the release of today’s manufacturing data. The Yen is also weaker due to expectations that the Bank of Japan will introduce further quantitative easing measures to send the Yen lower.
The US Dollar could make further gains against its peers and recover lost ground if this week’s data releases continue to come in positively. Expectations will mount that a cut to the Federal Reserve’s monetary easing programme will occur sooner-than-later due to the improving economy.
US Dollar (USD) Current Exchange Rates
The US Dollar/Pound Sterling Exchange Rate is currently in the region of: 0.6114
The US Dollar/Euro Exchange Rate is currently in the region of: 0.7387
The US Dollar/ Canadian Dollar Exchange Rate is currently in the region of: 1.0628
The Pound Sterling/US Dollar Exchange Rate is currently in the region of: 1.6355
The Euro/ US Dollar Exchange Rate is currently in the region of: 1.3537
(Correct as of 15:40 pm GMT)
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