“A reiteration of the hawkish minutes will likely lead to front-end steepening and push USD higher”, he said.On the US data front, home resales rose more than expected in April, suggesting the economy continues to gather pace during the second quarter.The dollar index, which tracks the greenback against a basket of six rival currencies, was steady at 95.333 after gaining 0.8 percent last week.
Advertisement
A closely monitored survey of business activity shows that output growth in May slowed to its weakest rate since early 2015.
Markit’s Composite Purchasing Managers’ Index (PMI) edged down to 52.9 from April’s 53.
The manufacturing PMI fell to 51.5 from 51.7, missing the median Reuters poll forecast for 51.9, while an index measuring output dropped to 52.4 from 52.6. Domestic market conditions were the primary factor in reduced growth in new export business.
May data signalled the first acceleration in German private sector activity growth in 2016 so far. Both production and new orders declined sharply and at the quickest rates in 25 and 41 months respectively.
Growth in Germany continued to strengthen across both manufacturing and services, with the overall pace of expansion reaching its highest since the end of a year ago.
Producers reported that domestic market conditions remained tough, and softer global trade flows led to the smallest rise in new export business for 16 months.
New orders grew at the weakest pace since January a year ago, pointing to subdued output growth next month at best, according to the report.
LONDON, May 23 Business growth across the euro zone dipped to a 16-month low in May but stronger showings from Germany and France suggest it is the smaller member countries that may be struggling.
Some good news however – Eurozone employment rose for the nineteenth month running in May, led by services though factories also reported a modest rise in headcounts.
Advertisement
The boost from France and Germany were offset by a further cooling of the rate of expansion outside of the big-two nations to a 17 month low. The overall rise in employment was the largest since February. “Inflows of new work showed the smallest rise for almost a year and a half, while optimism about the business outlook in the service sector sank to its lowest since July 2015”. China’s GDP expansion has slowed substantially from most previous years.
