As geopolitical tensions between the East and West rise, sanctions and souring relations could have lasting impacts on business globally.
- US factory orders expected to slide
- Uptick in business confidence may strengthen CAD
- AUD to weaken as GDP slides?
While Trump’s recent protectionist rhetoric is likely to continue to be the main source of movement in the US dollar today, it may come under further pressure this afternoon with the release of the latest US factory order figures.
Current forecasts suggest that US factory orders will have declined at the start of the year, with order growth predicted to tumble from 1.7% to -1.3% in January.
This will see orders decline for their first time since July and sink well below the long-term average of 0.29%, if the forecast is correct.
Uptick in Ivey PMI may bolster CAD
The release of Canada’s latest Ivey PMI is likely to bolster the Canadian dollar this afternoon as markets expect it to have rebounded after a sharp drop in January.
The Ivey PMI, a measurement of domestic business confidence is forecast to have climbed to 55.2 to 56.3 in February, as sentiment rallies after slumping at the start of the year.
However this will still leave the index below the long-term average of 56.94 and well behind the high of 63.8 struck in October, possibly limiting any gains for CAD.
Some economists have a decidedly more pessimistic outlook however as they suggest that concerns Trump could pull out of NAFTA may have prompted confidence to fall for the fourth consecutive month.
Australian GDP expected to slow in 2017
The Australian dollar may stumble in overnight trade on Tuesday, following the publication of the country’s latest GDP figures.
Economists forecast growth will have remained robust at the end of 2017, with fourth quarter GDP expected to have held at 0.6%.
However some analysts suggest that a decline in capital expenditure at the end of last year could lead to a more underwhelming reading than initially expected.
Meanwhile, annualised figures are likely to be even more downbeat as they are predicted to show economic growth slowed from 2.8% to 2.2% in 2017.
Tuesday, 6 March, 2018
15:00 CAD Ivey PMI
Wednesday, 7 March, 2018
00:30 AUD Q4 GDP
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)