Daily digest market movers: DXY buoyed by robust business activity, hawkish Fed bets

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  • Institute for Supply Management (ISM) report shows business activity for March improved for the first time since September 2022, indicating a robust economy.
  • Manufacturing Purchasing Managers Index (PMI) hit 50.3 in March, surpassing projected figures of 48.4 and appreciably exceeding February's reading of 47.8. 
  • ISM report's Prices Paid Index rose to its highest level of 55.8 YoY since 52.5 in August 2022.
  • An improving economy might discourage the Fed from relaxing its monetary policy.
  • As a reaction to ongoing US economic resilience, the odds for a rate cut in June's meeting dropped from 85% to around 65%.
  • In the bond market, US Treasury bond yields surged. The 2-year yield is at 4.71%, the 5-year yield at 4.33%, and the 10-year yield at 4.33%, all showing sharp increases and reflecting a boost in hawkish bets.
  • Pertinent US labor market data such as Average Hourly Earnings, Nonfarm Payrolls, and the Unemployment Rate will provide a vital understanding of the health and trends of the country's workforce.


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