Halo Financial Team
Halo Financial
Today's Highlights
Dollar losing ground ater weaker NFP
UK construction PMI expected to ease sligtly
Central banks in focus this week
FX Market Overview
The dollar lost some of its lustre on Friday after a weaker than expected Non-Farm payrolls report. NFP came in under consensus at 209k.The disappointment is expected to be temporary as overall the report still confirmed that job creation remains robust. Quantitative easing is coming to an end in the United States and there will be more talk of when interest rates will begin to rise. Additionally the ISM manufacturing index rose to 57.1 in July from 55.3 in June leaving the index at its highest level since April 2011. Its good news for the US growth story and reinforces the view that the US economy is on a sound footing and that the Federal reserve may be forced to hike rates sooner than the market anticipates. The dollar should rally further.
It's a quiet start to the trading week today with only the UK Construction purchasing managers index to look forward to this morning. After last week's poor manufacturing data this will garner a little more attention than usual as another weak data release could add to the view that the UK economy may be consolidating and need new impetus in order to continue on the current growth trajectory. Unless the figure is significantly underwhelming the Pound may well tread water and take its cue from events elsewhere.
Later this week several central bank make policy announcements including the Reserve bank of Australia , Bank of England and the European Central Bank. No changes in policy are expected although the weaker Eurozone inflation figure would have been a source of discomfort for the ECB the message on Thursday is likely to be one of patience as they wait for the current easing measure to filter through into the market. Be wary of any negative comments from ECB chief Mario Draghi regarding Russian sanctions affecting the Eurozone output which could weigh on the single currency.
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