United States Dollar:
It was an interesting start to the week yesterday as GBP bounced higher, due to healthy sales in EUR/GBP. UK Manufacturing PMI was then released at 9:30am and registered its slowest growth rate since June 2013, coming in at 52.5 vs. expectations for 55.1. GBP/USD slipped back to a low of 1.6612 on the news and it has continued to fall throughout the last 24 hours. Due to the US public holiday yesterday, there’s been no economic data released worth mentioning from the States over the last day or so. That said, the USD has performed stronger over this period and GBP/USD opens this morning at 1.6560. UK Construction PMI is due out this morning and if another soft reading follows we could see GBP/USD fall towards the 1.65 big figure. US markets are also back in full swing today, and we are due ISM Manufacturing PMI amongst other lots of economic releases. We expect a range today in the GBP/USD rate of 1.6500 to 1.6645.
Euro:
With the dollar having strengthened over the last 24 hours, EUR/USD has also fallen steadily since this time yesterday. A series of PMI’s from Europe didn’t help matters as Spanish Manufacturing PMI, Italian Manufacturing PMI and European Final Manufacturing PMI all printed weaker than market forecasts. EUR/USD eventually fell to a low of 1.3115 (early this morning). Despite this, the single currency has firmed up a little vs. the pound since Monday morning and opens today’s session at 1.2620.We expect a range today in the GBP/EUR rate of 1.2575 to 1.2650.
Aussie and Kiwi Dollars:
As expected, the RBA left interest rates unchanged overnight. There was very little new in the accompanying statement either; the central bank see interest rate stability as the most prudent course for now. They also stressed again that the Aussie dollar was too high to be deemed comfortable and Governor Stevens said: “it is offering less assistance than would normally be expected in achieving balanced growth in the economy”. AUD/USD has jumped 20 points or so following the news and it opens in London at .9365. In contrast NZD/USD has lost 30 points after hitting an overnight high of .8390 – it trades at .8350 currently. We expect a range today in the GBP/AUD rate of 1.7760 to 1.7900We expect a range today in the GBP/NZD rate of 1.9755 to 1.9930.
Data releases for the next 24 hours:
AUD: AIG Services Index, GDP q/q, RBA Gov. Stevens Speaks
EUR: PPI m/m
GBP: Construction PMI, BRC Shop Price Index y/y
NZD: No data
USD: Final Manufacturing PMI, ISM Manufacturing PMI, Construction Spending m/m, IBD/TIPP Economic Optimism, ISM Manufacturing Prices
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