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Can stronger services sector boost pound today?

business-articlesCan stronger services sector boost pound today?
  • Pound braces for UK services PMI

  • Bank of Canada meeting weighs on Canadian dollar

  • Retail sales recovery to boost euro

 
 

Pound volatility forecast on UK services PMI

 
The pound could find a stronger boost this morning if November’s UK services PMI prints positively.
 
As the service sector remains the primary growth engine of the UK economy any improvement here could encourage greater confidence in the wider outlook.
 
However, evidence that business confidence within the sector has deteriorated further in anticipation of Brexit would leave GBP exchange rates vulnerable to additional downside pressure.
 
If signs point towards growth continuing to moderate in the months ahead this could encourage another round of pound selling today.
 
 

Canadian dollar vulnerable ahead of BOC rate decision

 
CAD exchange rates may come under further pressure this afternoon as a result of the Bank of Canada’s (BoC) latest policy decision.
 
While markets do not expect to see any change in interest rates today the tone of the BoC’s commentary could provoke volatility for the Canadian dollar.
 
If the central bank looks likely to leave interest rates on hold for longer the mood towards the Canadian dollar would deteriorate.
 
On the other hand, greater signs of confidence among policymakers may offer CAD exchange rates a boost.
 
 

Stronger Eurozone retail sales to support euro

 
After the stagnation seen in September investors are looking for a rebound from October’s Eurozone retail sales data.
 
Evidence of increased consumer spending could give EUR exchange rates a solid boost this morning, with higher retail spending likely to benefit the wider economy.
 
As signs have pointed towards weakness within the Eurozone economy any positive data should give euro traders cause for confidence.
 
However, another weak month of sales growth may add to the Eurozone’s bearish economic outlook and prompt the euro to lose further ground against its rivals.
 
 

Upcoming Data:

 
Wednesday, 5th December 2018
09:30 GBP Services PMI
10:00 EUR Eurozone Retail Sales
15:00 CAD Bank of Canada Rate Decision
15:00 USD ISM Non-Manufacturing Composite Index

Philip McHugh

Philip McHugh

Joining the corporate trading desk in 2007, Phil now over sees all of Currencies Direct’s corporate dealing activity. Having gained experience working with hundreds of businesses to optimise international payments processes and execute comprehensive risk management strategies, Phil currently works with a portfolio of corporate clients whilst managing Currencies Direct’s overall market exposure

Phil has FCA approval and has completed the Certificate in International Treasury Management (CertiTM)

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