by Marc Chandler
The US dollar was already trading with a heavier bias before the shockingly poor service ISM. The August non-manufacturing ISM tumbled to 51.4, a six-year low, from 55.5 in July. Markit, which does its own survey, showed a smaller decline in its August read to 51.0 from 51.4 in July. This was up slightly from the preliminary 50.9 estimate.
In any case, the weakness in the manufacturing ISM, the softer than expected employment data, and now the weaker services ISM makes some economists fret about Q3 GDP and lowers the odds of a rate hike by the FOMC later this month. Recall that before the weekend, after the employment and trade figures, the Atlanta Fed’s GDP tracker pointed to 3.5% Q2 GDP, up from 3.2% previously. The NY Fed’s model was little changed on the week at 2.8%.