USD flows: ISM services data gives the USD a boost

A strong non-manufacturing ISM has given the USD a lift, with the index hitting its highest level since November 2022. We wouldn’t read too much into the data, particularly since the S&P services PMI was much less impressive, holding steady in the last few months. But there is still no real evidence of a significant US slowdown, and as long as that is the case it will be hard to oppose USD strength in the medium term, eve if we see a short term dip after the election. The risk positive currencies are likely to benefit more from this sort of strong data than the safe havens, and the JPY and the CHF are on the back foot after the numbers.