U.S. ISM manufacturing index rises in December, upside risks exist in 2017

Manufacturing activity in the United States rose during the month of December, with the index improving further from the strong reading in November and beating what markets had initially anticipated. However, there exists upside risks to the indicator in 2017.

The ISM manufacturing index rose to 54.7 in December, improving from the strong reading in November and above market consensus of 53.6. Most of the major subcomponents of the report pointed to continued expansion in manufacturing activity, data released by the Institute for Supply Management (ISM) showed Tuesday.

In particular, production index rose to 60.3, new orders at 60.2, and new export orders at 56.0 showed strength and are consistent with a near-term acceleration in manufacturing activity. The employment index remained in solid expansion territory (53.1; previous 52.3).

"Overall, this morning’s report indicates that US manufacturing activity ended 2016 on a high note and points to some upside risk to our expectation of a modest rise in manufacturing this year," Barclays commented in its recent research report.

Meanwhile, the dollar index traded at 103.29, up 0.08 percent, while at 4:00GMT, the FxWirePro's Hourly Dollar Strength Index remained neutral at 74.07 (a reading above +75 indicates a bullish trend, while that below -75 a bearish trend). For more details, visit http://www.fxwirepro.com/currencyindex