USD flows: USD to stay firm after solid PMI

The US S&P services PMI has come in slightly below consensus but the manufacturing PMI is above consensus and at a new high, leaving the composite PMI unchanged on the month. The US numbers are clearly stronger than the European numbers, and the resilience of EUR/USD and GBP/USD seen earlier in the day is starting to fade. There is scope for further USD strength, with yield spreads moving significantly in the USD’s favour on the day.