Pound (GBP) dented by downbeat PMI
The pound (GBP) came under pressure yesterday as the UK’s services PMI printed below expectations.
The survey score came in at 51.7 in September, down from 52.5 in August and below forecasts for 52, representing a larger-than-expected slowdown in the UK’s vital services sector.
Turning to today, the Confederation of British Industry’s (CBI) latest distributive trades survey could apply some pressure to the pound. However, the mid-tier release is unlikely to lead to notable GBP losses.
Euro (EUR) buoyed by positive PMIs
The euro (EUR) rose against its weaker peers yesterday after the Eurozone’s manufacturing and services PMIs for September both exceeded expectations.
However, the single currency struggled against its strongest peers as it suffered from its negative correlation with the rising US dollar (USD).
A modest improvement in Germany’s business climate index could buoy the euro today, although gains may be limited unless the data exceeds expectations.
US dollar (USD) climbs as PMIs smash expectations
The US dollar marched higher yesterday as markets bet on a more muscular approach to monetary policy from the Federal Reserve.
Hawkish Fed bets were reinforced in the afternoon after the latest S&P Global PMIs smashed forecasts, signalling the fastest expansion in private sector activity since July 2021.
Risk appetite could drive the US dollar today as markets keep an eye on geopolitical headlines amid the ongoing UN General Assembly session.
Canadian dollar (CAD) rallies as oil prices rebound
The crude-linked Canadian dollar (CAD) strengthened yesterday as oil prices pushed higher after falling for most of the week.
Today, an expected recovery in Canadian retail sales in August could support the ‘loonie’. However, the currency may struggle if oil prices resume their downward trend.
Australian dollar (AUD) pressured by rising unemployment
The Australian dollar (AUD) softened slightly overnight after Australia’s unemployment rate unexpectedly rose in August.
New Zealand dollar (NZD) muted amid cautious trade
The New Zealand dollar (NZD) traded in a narrow range overnight as a cautious mood suppressed the risk-sensitive ‘kiwi’.
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