• US ISM Manufacturing PMI rose slightly in August.
• US Dollar Index stays in daily range above 101.50.

The business activity in the US manufacturing sector continued to contract, albeit at a softer pace in August, with the ISM Manufacturing PMI edging higher to 47.2 from 46.8 in July. This reading came in slightly below the market expectation of 47.5.

The Employment Index of the PMI recovered to 46 from 43.4 in July, while the New Orders Index fell to 44.6 from 47.4 in the same period. Finally, the Prices Paid Index, the inflation component, rose to 54 from 52.9.

Commenting on the survey's findings, “while still in contraction territory, U.S. manufacturing activity contracted slower compared to last month," said Timothy R. Fiore, Chair of the Institute for Supply Management (ISM) Manufacturing Business Survey Committee. "Demand continues to be weak, output declined, and inputs stayed accommodative."

Market reaction

These figures don't seem to be having a significant impact on the US Dollar's valuation. At the time of press, the US Dollar Index was virtually unchanged on the day at 101.62.