Happy Friday, traders! Are you ready to trade at the end of the week? Here’s what you need to know before you start:
What to Expect from USD PMI Release?
What will happen?
The US Institute for Supply Management will announce the Purchasing Managers’ Index (PMI) on April 5, at 17:00 MT. The indicator measures the diffusion index level based on the info from purchasing managers, excluding manufacturing. This is a monthly release.
PMI is a leading indicator of economic health. Businesses respond quickly to market conditions, and their purchasing managers have the most up-to-date and relevant info about the companies’ views of the economy.
This data is obtained from a survey of approximately 300 purchasing managers. The survey respondents were asked to rate the relative level of business conditions, including employment, production, new orders, prices, supplier deliveries, and inventories.
How will USD react?
PMI provides useful information to business decision-makers, market analysts, and investors. It gives an expanded view of the services sector, so that investors have a better understanding of the business environment and valuable insights into the economic background of various markets.
The previous release on March 3 didn’t beat the expectations with 56.5 vs. 61.2. That’s why the USD boost was less than usual, only 430 points or 0.43%.
How to trade on PMI release?
PMI usually affects all pairs associated with the US dollar. Don't forget about gold. XAUUSD could experience a sharp move down if the index beats expectations.
- If the actual number is better than expected, the USD will rise.
- Otherwise it fall.
Check the Economic Calendar.
Instruments to trade: EURUSD, GBPUSD, XAUUSD, USDJPY.
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S&P Global, a private banking company, will release a monthly change in British Flash Manufacturing Purchasing Managers Index (PMI) on January 24, 11:30 GMT+2. The index is a leading indicator of economic health as businesses react quickly to market conditions, and purchasing managers hold the most current and relevant insight into the company's view of the economy.
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