Market Review - 05/10/2015 17:32GMT
The single currency turns lower after disappointing service sector data
The euro turned lower versus the U.S. dollar on Monday, as disappointing service sector data from the euro zone weighed. Markit's services PMI for the entire euro zone fell to 53.7 last month from 54.0 in August.
During the day, although the single currency found support at 1.2108 versus the U.S. dollar ahead of Asian open on Monday and then ratcheted higher to 1.1289 in Europe after release of euro zone retail data, renewed broad-based rebound in the greenback pressured price ahead of New York open and price later fell to a fresh session low of 1.1174 in New York morning before stabilising.
Eurostat showed the retail sales in the euro zone fell less-than-expected in September. It said that euro zone retail sales fell to 0.0% last month, from 0.6% in the preceding month whose figure was revised up from 0.4%. Earlier, Markit Economics said that German Services PMI fell to 54.1 in September, from 54.3 in the preceding month.
Versus the Japanese yen, the greenback traded with a biddish tone on Monday and edged higher finding supporting at 119.87 in Asia. Price climbed to 120.31 in European morning and then moved sideways before rising again in New York trading to 120.55.
In New York session, U.S., the Institute of Supply Management reported on Monday that its non-manufacturing PMI fell to 56.9 in September from a reading of 59.0 the previous month. Analysts had expected the index to tick down to 57.5 last month. In a separate report, Markit said that U.S. Service sector final PMI for September was at 55.1 versus flash reading 55.6 and 56.1 in August.
The British pound climbed higher in Asia in tandem with euro and briefly rose to 1.5245 in European morning before retreating. Cable later came under pressure after data showed service sector activity in the U.K. fell unexpectedly last month and dropped to 1.5172, then 1.5140 in New York midday before recovering.
The Chartered Institute of Purchasing & Supply and the NTC Economics said that U.K. Services PMI fell to a seasonally adjusted annual rate of 53.3, from 55.6 in the preceding month. Market had expected U.K. Services PMI to rise to 56.0 last month.
In other news, President of the Federal Reserve Bank of Boston, Eric Rosengren said in an interview with Reuters on Monday, 'expects rate hike this year despite weak September jobs report; jobs report cud signal greater economic weakness that delays hike; would delay rate hike to 2016 if unemployment rises or GDP growth below 2%; no need for evidence of higher inflation, wages to raise rates; would back appropriate rate hike even if market probability 30%; delaying hike too long risks abrupt tightening; international conditions biggest risk to U.S. economy.'
Data to be released on Tuesday:
New Zealand business confidence, Australia Westpac consumer confidence, imports, exports and trade balance, RBA rate decision and statement, Germany factory orders, U.K. Halifax house prices, Switzerland CPI, U.S. trade balance, Redbook, and Canada trade reports.
The single currency turns lower after disappointing service sector data
The euro turned lower versus the U.S. dollar on Monday, as disappointing service sector data from the euro zone weighed. Markit's services PMI for the entire euro zone fell to 53.7 last month from 54.0 in August.
During the day, although the single currency found support at 1.2108 versus the U.S. dollar ahead of Asian open on Monday and then ratcheted higher to 1.1289 in Europe after release of euro zone retail data, renewed broad-based rebound in the greenback pressured price ahead of New York open and price later fell to a fresh session low of 1.1174 in New York morning before stabilising.
Eurostat showed the retail sales in the euro zone fell less-than-expected in September. It said that euro zone retail sales fell to 0.0% last month, from 0.6% in the preceding month whose figure was revised up from 0.4%. Earlier, Markit Economics said that German Services PMI fell to 54.1 in September, from 54.3 in the preceding month.
Versus the Japanese yen, the greenback traded with a biddish tone on Monday and edged higher finding supporting at 119.87 in Asia. Price climbed to 120.31 in European morning and then moved sideways before rising again in New York trading to 120.55.
In New York session, U.S., the Institute of Supply Management reported on Monday that its non-manufacturing PMI fell to 56.9 in September from a reading of 59.0 the previous month. Analysts had expected the index to tick down to 57.5 last month. In a separate report, Markit said that U.S. Service sector final PMI for September was at 55.1 versus flash reading 55.6 and 56.1 in August.
The British pound climbed higher in Asia in tandem with euro and briefly rose to 1.5245 in European morning before retreating. Cable later came under pressure after data showed service sector activity in the U.K. fell unexpectedly last month and dropped to 1.5172, then 1.5140 in New York midday before recovering.
The Chartered Institute of Purchasing & Supply and the NTC Economics said that U.K. Services PMI fell to a seasonally adjusted annual rate of 53.3, from 55.6 in the preceding month. Market had expected U.K. Services PMI to rise to 56.0 last month.
In other news, President of the Federal Reserve Bank of Boston, Eric Rosengren said in an interview with Reuters on Monday, 'expects rate hike this year despite weak September jobs report; jobs report cud signal greater economic weakness that delays hike; would delay rate hike to 2016 if unemployment rises or GDP growth below 2%; no need for evidence of higher inflation, wages to raise rates; would back appropriate rate hike even if market probability 30%; delaying hike too long risks abrupt tightening; international conditions biggest risk to U.S. economy.'
Data to be released on Tuesday:
New Zealand business confidence, Australia Westpac consumer confidence, imports, exports and trade balance, RBA rate decision and statement, Germany factory orders, U.K. Halifax house prices, Switzerland CPI, U.S. trade balance, Redbook, and Canada trade reports.
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