The U.S. ISM manufacturing PMI for August came in at 47.2, up from the earlier month’s 46.8 reading but short of the 47.5  consensus, reflecting a slower pace of industry contraction.

Components of the report revealed that the prices index advanced from 52.9 to 54.0 while the employment index also improved from 43.4 to 46.0. However, the overall dip was mostly spurred by another monthly decline in new orders, as well as a drop in production.

Link to August U.S. ISM manufacturing PMI

“Demand continues to be weak, output declined, and inputs stayed accommodative,” said Timothy Fiore, chair of the ISM Manufacturing Business Survey Committee.

“Demand remains subdued, as companies show an unwillingness to invest in capital and inventory due to current federal monetary policy and election uncertainty.”

U.S. dollar vs. Major Currencies: 5-min

Overlay of USD  vs. Major Currencies Chart by TradingView

The Greenback, which was having a mixed run leading up to the release of the ISM manufacturing PMI report, cruised higher across the board upon seeing slightly better than expected results.

Dollar bulls seemed to find some relief from the uptick in the employment and prices components, as the former brought positive vibes ahead of this Friday’s NFP release.

The U.S. currency was able to hold on to most of its post-PMI gains, except against the Loonie, as it moved sideways for the next few hours after the report.

The construction spending report released at the same time indicated a 0.3% monthly decline for July instead of the estimated 0.1% uptick while the RCM/TIPP consumer optimism index printed a few minutes later showed a small improvement.