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DXY Touches New Multiyear Low as Markets Buy Equity Dip

FOREX

GBP trades well Tuesday, with UK markets returning from yesterday's bank holiday. GBP/USD saw decent volume on the way higher, with the pair topping out at the best levels since December last year at $1.3442.

Data so far this morning has been generally risk favourable, with final August manufacturing PMIs being revised higher for Italy and France. Elsewhere, the German government has revised their 2020 GDP forecasts higher, projected a shallower recession than previously forecast.

The greenback is generally lower, with the USD index hitting new multi-year lows early Tuesday. The moves comes alongside a recovery off yesterday's lows for US equities, with the e-mini S&P once again narrowing the gap with alltime highs printed yesterday at 3524.50.

US ISM Manufacturing is the data highlight Tuesday, with the employment component likely to draw particular focus ahead of this Friday's Nonfarm payrolls release. Final August PMIs from Canada and the US also cross as well as Brazilian GDP for Q2. Central bank speakers today include ECB's Knot, Lane and de Cos, with Fed's Brainard also a highlight, speaking directly on the Fed's new policy framework.

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