USD flows: USD well supported after Philly Fed strength

While jobless claims were unremarkable, the Philadelphia Fed survey produced the best manufacturing index for two years, and also the highest prices paid index since December. The USD initially edged higher in response, with front end yields a couple of bps higher too, but there hasn’t been much net reaction, with most pairs little changed. Still, the strength if the index supports the more hawkish Fed pricing we have seen in the last week or two, and suggests there is little reason to expect a reversal of recent USD strength.