By Christopher Vecchio, Currency Analyst The US Dollar has had a rough few trading days, as the Dow Jones FXCM Dollar Index (Ticker: USDOLLAR) lost over 1 percent between last Wednesday’s Federal Open Market Committee rate decision and yesterday’s low. However, on the back of a better than expected manufacturing report, the US Dollar has rebounded against its more significant currency counterparts, with the USDOLLAR (equal-weighted index of AUDUSD, EURUSD, GBPUSD, and USDJPY) taking back just over half of a percent after the release. The Institute of Supply Management’s manufacturing index for April rebounded to 54.8 from 53.4 in March, erasing the losses from the prior two-months and pulling the index to its highest level in ten-months. Overall, the report was robust all-around, with the employment subcomponent most notably rising to 57.3 from 56.1. The ISM’s report is likely to alleviate some of the concerns raised by the first quarter United States growth reading on Friday, and should ease tensions headed into Friday’s crucial nonfarm payrolls report. USDJPY 1-minute Chart: May 1, 2012 Charts Created using Marketscope – Prepared by Christopher Vecchio While the USDOLLAR moved higher, it was mainly on the back of weakness by the Euro and the Japanese Yen, not by the Australian Dollar or British Pound. The EURUSD fell by as much as 0.60 percent to 1.3204 from 1.3284 after the release, while the USDJPY rallied for as much as 0.73 percent to 80.39 from 79.72. It is worth noting that trading conditions remain thin with most major Asian and European markets closed for holidays. --- Written by Christopher Vecchio, Currency Analyst To cont act Christopher Vecchio, e-mail email@example.com Follow him on Twitter at @CVecchioFX To be added to Christopher’s e-mail distribution list, send an e-mail with subject line "Distribution List" to firstname.lastname@example.org
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