In the European session, we don’t have much on the agenda other than a few low tier releases like the final PMIs and the Eurozone PPI data. None of these reports will change anything for the ECB or BoE and therefore won’t influence the market pricing.

In the American session, the focus will be on the US ISM Services PMI which is expected at 51.5 vs 50.8 prior. The S&P Global US Services PMI rose to a 7-month high and the agency noted that July’s expansion was powered by the services economy,
where business activity rose at a rate not seen since last
December. They also noted higher inflationary pressures, especially in the services sector.

The ISM Services PMI has been a very unreliable and volatile indicator in the past 2 years. Nonetheless, it’s still a market-moving report and with so much focus on the data due to the Fed’s data-dependent approach, such high tier indicators acquire more importance. Given that we already had the NFP, the employment component will be ignored and the focus will be on the prices component.

Finally, keep an eye on Fedspeak as comments from Fed officials are going to be important for market’s pricing (although we have already fully priced in two cuts by year-end starting in September).

This article was written by Giuseppe Dellamotta at investinglive.com.