• ISM services PMI drops to 52.1, misses expectations
• Employment and new orders ease, prices stabilize
• EURUSD wins marginally, Wall Street hits record high

The ISM non-manufacturing PMI index, which is a good proxy of consumer activity, fell faster than analysts thought to 52.1, dismissing forecasts for a marginal decline from 56.0 to 55.5.

In other parts of the survey, new orders and hiring experienced a surprisingly steeper decline, but interestingly the prices paid index remained more or less steady around 58.2, defying projections for a quick drop to 56.4.

Despite the stickiness in prices, rate cut expectations barely changed, with futures markets reflecting a 75% probability for a 25bps reduction during December’s FOMC policy meeting.

Analysts did not adjust their nonfarm payrolls forecasts much either, remaining confident that a 200k increase is possible on Friday despite the private ADP jobs report arriving weaker than expected at 146k.

Markets showed a moderate initial reaction, with EURUSD inching up to a two-day high of 1.0543 and the S&P 500 rising softly to a new record high of 6,075.