US Dollar Drops on Weak PMI Data, Coronavirus Hits Confidence
Markit PMI Talking Points:
- US Dollar drops on weak PMI Data
- Composite PMI at lowest level since 2013
- Coronavirus impact hurting confidence
The US Dollar dropped this morning as PMI figures crossed the wires. The US business and services sectors dropped sharply in February, according to Markit Economic. Its monthly PMI report printed 49.4 for the services sector, missing expectations of 53.4. Manufacturing slowed for February, coming in at 50.8 versus expectations of 51.5.
US Dollar Chart – DXY Index
Headwinds from the novel coronavirus outbreak in China weighed on both the services and manufacturing sector as respondents reported concerns over the impact from the virus. The pandemic injected a bout of volatility in markets through recent months, and the impacts to China is expected to spillover into the global economy.
New order volumes in manufacturing dropped to the lowest level in nine months and private companies failed to bring in new foreign clients. Coronavirus was cited as a factor for the drop in new export orders. While business confidence strengthened to reach an eight-month high this month, the metric remains near historical lows.
--Written by Thomas Westwater, Intern Analyst for DailyFX.com
Contact and follow Thomas on Twitter @FxWestwater
DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.