Caixin China PMI Mfg (Feb): 40.3 (est 46, prev 51.1)

Ross J Burland FXStreet

Caixin China PMI Mfg (Feb) has been released and is below contraction territory, as to be expected considering the coronavirus impact on the economy.

Caixin China PMI Mfg (Feb)

40.3 (est 46, prev 51.1). This data shows that Production, New Orders Collapse, Employment all shrinks at the sharpest pace on record

There has been less of a shock in this data considering the weekend's official February manufacturing PMI plunging 14.3 points to 35.7 – a record low. "This is one of the first pieces of Chinese economic data reflecting the impact of COVID-19, and it was weaker than expected, weaker than the previous low of 38.8 in November 2008. The non-manufacturing index also fell sharply, down 24.5 points to 29.6 – a record low," analysts at Westpac explained.

Description

The Caixin China Manufacturing PMI™, released by Markit Economics, is based on data compiled from monthly replies to questionnaires sent to purchasing executives in over 400 private manufacturing sector companies.

Market implications

AUD/USD: Bid tone intact despite below-forecast China Caixin PMI

Author

Ross J Burland

FXStreet

Ross J Burland, born in England, UK, is a sportsman at heart. He played Rugby and Judo for his county, Kent and the South East of England Rugby team.

EUR/USD stays weak near 1.1850 after dismal German ZEW data

EUR/USD remains in the red near 1.1850 in the European session on Tuesday. A broad US Dollar bullish consolidation combined with a softer risk tone keep the pair undermined alongside downbeat German ZEW sentiment readings for February.

GBP/USD holds losees near 1.3600 after weak UK jobs report

GBP/USD is holding moderate losses near the 1.3600 level in Tuesday's European trading. The United Kingdom employment data suggested worsening labor market conditions, bolstering bets for a BoE interest rate cut next month. This narrative keeps the Pound Sterling under bearish pressure.

Gold pares intraday losses; keeps the red above $4,900 amid receding safe-haven demand

Gold (XAU/USD) attracts some follow-through selling for the second straight day and dives to over a one-week low, around the $4,858 area, heading into the European session on Tuesday.

Canada CPI expected to show sticky inflation in January, still above BoC’s target

Economists see the headline CPI rising by 2.4% in a year to January, still above the BoC’s target and matching December’s increase. On a monthly basis, prices are expected to rise by 0.1%.

UK jobs market weakens, bolstering rate cut hopes

In the UK, the latest jobs report made for difficult reading. Nonetheless, this represents yet another reminder for the Bank of England that they need to act swiftly given the collapse in inflation expected over the coming months.

Stellar mixed sentiment caps recovery

Stellar price remains under pressure, trading at $0.170 on Tuesday after failing to close above the key resistance on Sunday. The derivatives metric supports the bearish sentiment, with XLM’s short bets rising among traders and funding rates turning negative.