PMIs show US maintains outperformance
The most up-to-date read on major economies — the monthly purchasing managers’ indexes (PMIs) — painted a stark picture overnight. Europe and Australia saw sharp declines, the UK delivered mixed results, while Japan and the US held relatively steady.
Manufacturing surveys were generally more resilient, but consumer-driven services activity weakened significantly.
Germany and France led the declines in Europe. Manufacturing PMIs fell to 51.4 in May from 52.2 in April, while services dropped to 46.4 from 47.6. Any reading below 50 indicates contraction.
In contrast, the US saw manufacturing improve to 55.3 from 54.5, with services largely steady at 51.0.
In Australia, services fell to 47.7 from 50.7, while manufacturing edged lower from 51.3 to 50.2.
FX markets were relatively unfazed. USD/CAD slipped 0.2% and NZD/USD rose 0.1%, the only notable moves overnight.
Soft Australian jobs data hits AUD/USD
Australia’s latest labour market report came in soft across the board.
The unemployment rate rose to 4.5% (+0.2ppt). Employment declined by 16k, with full-time roles down 10.7k and part-time jobs falling 7.9k. The underemployment rate edged lower to 5.8% (‑0.1ppt), while participation slipped to 66.7% (‑0.1ppt). Total hours worked ticked up 0.8%.
AUD/USD finished flat after initially dropping following the release. The pair now sits more than 2% below its recent high of 0.7278 on 6 May.
If selling pressure continues, AUD/USD may find support near the 100-day average around 0.7012. On the upside, resistance sits near the 21-day average at 0.7166.
USD eases in Asia as Fed signals patience
Minutes from the April Fed meeting show policymakers shifting their stance. Most participants noted that if price pressures remain above the 2% target, tighter policy settings could eventually be required.
Many also felt the official statement should have dropped its easing bias at that meeting, pointing to broader agreement beyond the small number of formal dissents.
The key takeaway: despite global uncertainty, officials prefer to keep policy steady for longer.
In Asia, USD/CNH is trading just 0.3% above its recent low of 6.7816 (14 May).
For USD/CNH to move higher, it needs to break above the 21-day average at 6.8135. A move above that level would open the path toward the 50-day average near 6.8408.
USD/SGD was broadly flat near one-week lows.
Aussie continues to lose momentum
Table: seven-day rolling currency trends and trading ranges
Key global risk events
Calendar: 18 – 23 May
Have a question? [email protected]
*The FX rates published are provided by Convera’s Market Insights team for research purposes only. The rates have a unique source and may not align to any live exchange rates quoted on other sites. They are not an indication of actual buy/sell rates, or a financial offer.
