Services PMIs point to broader economic weakness

A raft of weaker services surveys have weighed on sentiment in Europe at the start of the week while Wall Street is more of a mixed bag.

Investors are still digesting Friday’s jobs report which didn’t settle the debate on whether the Fed should pause or not ahead of the meeting next week. There were positives and negatives in the report but ultimately now it comes down to the inflation data next week.

The services PMIs today have broadly disappointed despite remaining in a healthy position. The UK was among the minority to see a positive revision while the numbers from the euro area saw some quite substantial declines, albeit while remaining well above the 50 level that separates growth from contraction.

The US ISM services PMI fell sharply to 50.3 against expectations of a small increase to 52.6, a sign that credit conditions and the drawdown of pandemic savings are finally hitting services activity. Further evidence will be wanted by the Fed but the trend has been declining and combined with other data, policymakers may now be hopeful that its aggressive tightening cycle is having an impact.

Range-bound trade continues in bitcoin

Bitcoin is almost 2% lower on Monday after edging higher over the weekend. The price initially dipped following the jobs report on Friday but quickly recovered and is now trading not far from where it was before the release. It remains range-bound between $26,000 and $28,000 where it has traded over the last month and is showing little sign of breaking out in either direction.

For a look at all of today’s economic events, check out our economic calendar: www.marketpulse.com/economic-events/

Content is for general information purposes only. It is not investment advice or a solution to buy or sell securities. Opinions are the authors; not necessarily that of OANDA Business Information & Services, Inc. or any of its affiliates, subsidiaries, officers or directors. If you would like to reproduce or redistribute any of the content found on MarketPulse, an award winning forex, commodities and global indices analysis and news site service produced by OANDA Business Information & Services, Inc., please access the RSS feed or contact us at info@marketpulse.com. Visit https://www.marketpulse.com/ to find out more about the beat of the global markets. © 2023 OANDA Business Information & Services Inc.