The plunge in the dollar yesterday came after a rather abysmal US services PMI reading in which if you strip out the pandemic, was the worst reading since 2009. It was tough for the greenback to recover sentiment in the immediate aftermath but USD/JPY did pull up from a low of 135.80 to return to 137.00 earlier today.
Despite the concerning data, the dollar remains in a good spot technically with EUR/USD continuing to keep under parity so far. The pair is down 0.2% to 0.9950 now after a rejection at the key figure level:
Looking at the charts, the dollar remains in charge for the most part with GBP/USD taking another look at 1.1800 and AUD/USD also down 0.4% to 0.6900 on the day as risk tones continue to reflect softer sentiment. S&P 500 futures are down another 14 points, or 0.3%, currently after the retreat yesterday.
Elsewhere, the bond market continues to stick with the recent technical push as 10-year yields hold above 3% despite a sharp drop initially after the poor data overnight. It seems very much like markets are wanting to stick with the narrative from earlier in the week until we get to Jackson Hole before any further major moves.
