Pound (GBP) steady amid final PMI results
The pound (GBP) wavered yesterday, as the UK’s final services PMI failed to provide GBP with a notable upside.
While the PMI was revised higher to show a larger recovery in service sector activity last month, Sterling’s initial gains were limited, and the currency struggled to sustain them through the session.
UK economic data is absent from the calendar today. As a result, movement in the pound may be muted.
Euro (EUR) wobbles as investors digest data
The euro (EUR) also moved without a clear trajectory yesterday, with a modest upward revision to the Eurozone services PMI failing to translate into meaningful gains.
While the survey showed the sector had returned to expansion in July, the improvement was marginal. In addition, a 0.3% decline in Eurozone producer prices offset any potential upside.
Looking forward, the euro could face headwinds later today. Markets expect German factory orders and Eurozone retail sales to have slowed in June.
US dollar (USD) edges lower as market mood improves
The US dollar (USD) softened yesterday, with the safe-haven currency initially coming under pressure due to an improvement in market risk appetite.
Later in the session, the ISM services PMI left USD lacking support. July’s survey showed a marginal rise from 54 to 54.1, missing forecasts for a bigger increase to 54.5.
The latest US initial jobless claims figure is due for release later today, with a rise in claims potentially weighing on USD. In the meantime, a sense of caution despite a potential deal to reopen the Strait of Hormuz is underpinning the US dollar.
Canadian dollar (CAD) muted as oil prices waver
The crude-linked Canadian dollar (CAD) was subdued yesterday, with oil prices briefly touching multi-week lows amid cautious optimism that the US and Iran could agree a new ceasefire.
Turning to today, Canada’s latest services PMI could influence the ‘loonie’. If it reports another month of declining activity in July, CAD exchange rates could struggle.
Australian dollar (AUD) stumbles despite positive trade data
The Australian dollar (AUD) weakened overnight on Wednesday, with a surprise expansion in Australia’s trade balance, courtesy of a sharp rebound in exports, failing to offer support to the risk-sensitive currency.
New Zealand dollar (NZD) dips in cautious trade
The New Zealand dollar (NZD) also retreated in overnight trade, undermined by a softening of investor risk appetite.
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