The US manufacturing sector is slowing down according to the ISM measure: a score of 54.8 points, significantly below expectations. The employment component took an even bigger dive: 52 points in April after 56 points in March. This implies a slower pace of hiring. 

The US dollar is falling. Currencies gaining some 10 pips against the greenback.

Other components: new orders fell sharply from 64.5 to 57.5. The new score still reflects a robust pace of growth. Prices paid dropped from 70.5 to 68.5 points.

A separate release saw US construction spending dropped by 0.2%, below 0.4% expected, but on top of a big upwards revision: 1.8% instead of 0.8% originally published.

The US ISM Manufacturing PMI was expected to score 56.5 points in April, a small drop from 57.2 in March. This is the first hint for Friday’s Non-Farm Payrolls report. Markit’s final manufacturing PMI came out at 52.8, unchanged from the original release.

The US economy leans heavily towards services, but manufacturing is also watched, especially with Trump in the White House.

The US dollar started the month on a higher note, thanks to the aversion of a government shutdown. On the other hand, data released earlier showed that inflation is slowing down: 1.6% y/y in the Fed’s favorite measure. Consumption and spending missed expectations.

Most of the world is on holiday today but the US and Canadian markets are open. Trading volume is lighter today and everybody will return to full swing tomorrow.

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