Dollar Rises on Manufacturing PMI as France's Political Landscape Wobbles

US dollar gained momentum after better than expected US ISM manufacturing PMI . It hits a high of 106.73 and is currently trading around 106.52.

Manufacturing Insights: Signs of Improvement Amid Contraction

The US ISM Manufacturing PMI for November 2024 rose to 48.4, up from 46.5 in October, showing slight improvement but still indicating contraction for the eighth month. The New Orders Index increased to 50.4, suggesting weak growth, while the Employment Index improved to 48.1. Price pressures eased, with the Prices Paid Index dropping to 50.3. Overall, the US Dollar strengthened following these mixed but hopeful manufacturing reports.

Political Crisis in France: Euro Faces Headwinds

Euro lost its shine amid France's political crisis. It is facing a serious political crisis with Prime Minister Michel Barnier's minority government at risk of collapsing due to a no-confidence vote.

His proposed €60 billion budget to reduce the deficit is encountering strong opposition from both right and left-wing parties. To bypass this, Barnier used a controversial method to pass a social security budget, prompting more opposition challenges. The political turmoil has raised concerns about France's financial stability, affecting its bond yields and raising questions about future governance.