Todays ISM Manufacturing PMI May Hold Clues to the Future of US Economic Growth

Today’s ISM Manufacturing PMI May Hold Clues to the Future of US Economic Growth

The Institute for Supply Management is to release the manufacturing purchasing managers index and it will rise to 48.6 from the last figure in September, which was registered at 47.2.

This would point towards a possible stabilization in the manufacturing sector, yet still possibly reflecting going on contraction. If the PMI is expected to be higher and near or above 50, participants in the market may consider this a step towards recovery, which can lead to an even stronger USD. Generally speaking, if the reading is above 50, it implies that the industry is growing, and this normally bodes well with the value of the USD, since investors perceive it as good for the economy.

However, below 50 it might down the manufacturing activities, hence affecting the optimism over US economic growth in general. On the other hand, USD appears to be very likely to face minimal upward moves or even see some pressure coming depending on market sentiment and how that happens based on whether the report is friendly toward the overall economic trend.

While the consensus estimate looks for a modest gain, the actual PMI reading could turn market expectations on their head about how resilient the US economy is, leaving open a whole range of possible outcomes from here forward for both the US dollar and the manufacturing sector.

Today’s JOLTS Report Could Shape Views on Labor Market Strength

The Bureau of Labor Statistics is going to release its latest report on JOLTS Job Openings  today at 14:00 GMT, with an estimated number of 7.721 million and it indicates an increase in comparison with the previous number of 7.673 million. Increased job openings indicate that the US labor market may actually be tightening, which means that a sustained demand will be made from all sides on commercial, industrial, and office sectors. If the actual data exceeds expectations, market participants might take it as a sign of labor market strength that could boost confidence in the US economy and positively affect the US dollar. However, if the report comes in as expected, it would probably weaken labor demand, which may soften up expectations of near-term economic growth.