The US Dollar firmed against the Pound and Euro on Monday as concerns over the situation in Ukraine bolstered demand for safe haven currencies and as data out of the US eased fears that the world’s largest economy is slowing down.
Markit’s latest US manufacturing PMI climbed from the 56.7 reading recorded in January to 57.1 in February, easing concerns that the harsh winter weather had hurt the nation’s economy. Companies reported a surge in output and new orders and job creation hit its best level in eleven months. The figure is one of the largest monthly improvements seen in almost four years.
A separate report released by the Washington based Commerce Department showed that consumer spending increased more than economists had been predicting in January. Consumer spending accounts for around 70% of the US economy climbed by 0.4%, an improvement on the previous month’s figure of 0.1%. The figure would likely have been higher if not for the harsh winter weather that has affected large parts of the US.
The ISM Manufacturing PMI for February came in above forecast to show an improvement on January’s figure. The PMI rose from 51.3 to 53.2. Economists had been expecting a figure of 52.
The US Dollar also found support from an increased demand for safe haven assets. As the situation in Ukraine escalates we can expect the ‘Greenback’ to continue to be supported by haven demand. The threat of economic sanctions being imposed on Russia as a result of its invasion of the Crimea saw the Russian Rouble plummet to a record low against the US Dollar.
US Dollar (CAD) Exchange Rates
[table width=”100%” colwidth=”50|50|50|50|50″ colalign=”left|left|left|left|left”]
Currency, ,Currency,Rate ,
US Dollar,
,Pound Sterling,0.5982 ,
US Dollar,,Euro,0.7263 ,
US Dollar,,Canadian Dollar,1.1084 ,
US Dollar,,Australian Dollar,1.1208 ,
[/table]
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