The US dollar is once again showing that small disappointments in economic data are having a larger impact than good news.
The ISM manufacturing index edged lower in May to 55.3 from 55.4 and fell short of the 55.9 consensus estimate and the US dollar. Cable rallied 15 pips to a five year high of 1.7162 along with similar moves in other crosses.
The place to watch is EUR/USD — the pair ripped to 1.3700 but was unable to break through and skidded back to 1.3688. if that level holds the US dollar could mount a comeback but if it breaks definitively, watch out for a USD rout.
