Prior to the Covid-19 pandemic, the majority of UK companies employed an on-site workforce to conduct the day-to-day running of their business, with only 27% of employees having worked from home at some point in 2019, on average.
- Pound recovers ground ahead of manufacturing PMI
- US dollar falters as Fed faces increased political pressure
- Canadian GDP miss drags Canadian dollar lower
Conservatives take 15 point lead
The pound firmed through yesterday’s session, buoyed by speculation that a Conservative victory in the upcoming election could help break the Brexit deadlock in parliament.
In its first poll since the December election was confirmed, YouGov gave the Tories a 15 point lead over Labour.
Expectations of a Tory majority were also boosted by reports that the Brexit party may only contest a handful of constituencies in order to avoid splitting the vote with the Conservatives.
However, the pound could weaken this morning if October’s UK manufacturing PMI slips deeper into contraction territory as forecast.
Slower employment growth could add to US dollar downtrend
As the White House continued to level criticism at the Federal Reserve the mood towards the US dollar was muted yesterday.
Fresh easing in the personal consumption expenditure index, which remains the Fed’s preferred gauge of inflationary pressure, added to doubts that the central bank will remain on hold for long.
If the headline change in non-farm payrolls figure shows a sharp decline on the month as forecast, clocking in at just 89,000, this could drive further US dollar losses.
Further Canadian dollar weakness forecast on manufacturing slowdown
August’s Canadian gross domestic product data failed to shore up CAD exchange rates yesterday as monthly growth only improved to 0.1%.
With domestic growth still proving lacklustre the likelihood of future Bank of Canada (BOC) monetary loosening picked up.
Support for the Canadian dollar could fade further if this afternoon’s manufacturing PMI shows any deterioration on the month.
A weaker performance from the manufacturing sector would expose CAD exchange rates to further selling pressure as confidence in the Canadian outlook continues to weaken.
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