US Flash PMIs Forecast to Confirm Steady Expansion in June

S&P Global will release the June flash Purchasing Managers’ Indices (PMIs) for most major economies, with the United States (US) data scheduled on Tuesday.  These surveys of top private-sector executives are seen as an early indicator of the country’s economic health. 

Market participants anticipate that the S&P Global Services PMI will print at 51, up from 50.7 in May, while S&P Global Manufacturing output is expected to print at 54.7, slightly below the previous month’s 55.1 reading. The Composite PMI, a combination of manufacturing and services data, stood at 51.5 in May.

S&P Global separately reports manufacturing activity and services activity through the Manufacturing PMI and the Services PMI. Additionally, they present a weighted combination of the two, the Composite PMI. Generally speaking, a reading of 50 or more indicates expansion, while readings below the threshold indicate contraction.

The preliminary or flash versions tend to have a broader impact on the US Dollar (USD).

What Can We Expect From the Next S&P Global PMI Report?

The impact this time could be larger than usual. Last week, the Federal Reserve (Fed) had a monetary policy meeting, and the announcement was not about interest rates, but about a shift in how the Fed decides and communicates. 

Sure, the dot plot in the Summary of Economic Projections (SEP) showed that policymakers now anticipate a rate hike this year, vs. the previous SEP, which anticipated a cut.

But market participants got far more nervous about Chair Kevin Warsh drastically reducing forward guidance. Not only was the Federal Open Market Committee (FOMC) statement halved, but Warsh also refrained from including his “views” in the dot plot. Warsh aims to completely shift the focus from guidance to rough data.

S&P Global PMIs may not be a game-changing data release and may have a limited impact on the FOMC’s decision. But market participants may well start weighing in on data in the absence of forward guidance.

Additionally, the US Dollar (USD) heads into the release with uncertainty-related strength. The USD holds onto post-Fed gains and extends its advance amid caution over Middle East developments. Optimism reigned last week after the United States (US) and Iran signed a deal to extend the truce and go into deeper negotiations. 

The deal included the reopening of the Strait of Hormuz, something markets welcomed strongly. Weekend news, however, hit such markets’ confidence as Iranian authorities announced they would close the critical sea passage again. Negotiations continue, as well as navigation through the Strait, but optimism faded.

The Greenback is also firmer amid mounting speculation the Fed will deliver an interest rate hike before year-end. Despite Warsh’s disbelief in forward guidance, his words leaned hawkish, while half of the FOMC voting members added a dot on rate hikes.

Back to PMIs, the figures are expected to confirm economic expansion continues in the US, with modest ticks in any direction having little relevance, as long as the figures remain within expansion territory. For sure, better-than-anticipated figures would boost the Greenback, while weaker-than-anticipated figures could trigger a near-term USD slide.

It’s also worth noting that the PMIs include inflation and employment sub-components that could reinforce or deny the market’s belief in upcoming interest rate moves. Inflationary pressures have been on the rise, which means that an uptick in the inflation-related index could add to rate hike speculation and push the USD even higher.

When Will the June Flash US S&P Global PMIs Be Released, and How Could They Affect EUR/USD?

The S&P Global Manufacturing, Services, and Composite PMIs reports will be released at 13:45 GMT on Tuesday, and as previously noted, are expected to show that US business activity continued to expand in June.

Valeria Bednarik, FXStreet Chief Analyst, notes: 

“The EUR/USD pair trades a handful of pips above the 2026 low of 1.1411 posted in March, and despite looking oversold in the near-term, the bearish momentum is strong enough to support lower lows ahead. From a technical perspective, the daily chart shows that technical indicators rotated south after a modest uptick within negative territory, while the pair extends its slide below all its moving averages. The 20-day Simple Moving Average (SMA) heads firmly lower at around 1.1560 and below the longer ones, usually an indication of sellers’ control.”

Bednarik adds: 

“A break below the aforementioned 2026 low exposes the 1.1360 price zone ahead of the 1.1300 threshold. Should the pair bounce, the first line of sellers aligns around 1.1470, a strong static resistance area, ahead of 1.1550.”

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