ISM Services PMI Seen Rising in August Amid Ongoing Inflation Concerns

The Institute for Supply Management (ISM) is set to release its August Services PMI on Thursday, and expectations point to a marginal improvement to 54.3 from July's 54.1.

This would be in line with consensus and reinforce the sector's resilience, offering a modest boost to confidence in the broader economy.

However, inflationary pressures remain a concern, with the Consumer Price Index (CPI) showing a small decline in July, but Personal Consumption Expenditures (PCE) readings remaining unchanged.

Fed officials have been cautious about these developments, keeping the issue of elevated inflation on the table and fueling speculation about rate hikes in the second half of the year.

An ISM Services PMI that meets expectations may not significantly impact the US Dollar (USD), but a softer-than-expected print could shake confidence and lead to USD trimming.