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Pound lacking support, UK confidence sticks at six-year low

business-articlesPound lacking support, UK confidence sticks at six-year low
  • Political uncertainty and UK confidence keep the euro under pressure
  • Stronger Eurozone inflation fails to shore up euro
  • US dollar sluggish after Thanksgiving break
Upward revision to UK manufacturing PMI could lift GBP
With the GfK consumer confidence index still trapped at a six-year low and political uncertainty rife, the mood towards the pound proved rather muted ahead of the weekend.
While markets hope that sentiment will recover in the wake of the upcoming general election (provided it delivers a degree of political certainty) GBP exchange rates still struggled.
It would take a positive revision to the UK’s manufacturing PMI to bolster the pound this morning. The initial reading came in at 48.3, below the 50 mark separating growth from contraction.
Euro fails to benefit from inflation data
The Eurozone consumer price index bettered forecasts in November, with the headline inflation rate picking up from 0.7% to 1.0% on the year.
But this improvement failed to lift the euro on Friday as inflation remains some way short of the European Central Bank’s (ECB) 2% target.
November’s Eurozone manufacturing PMI is not expected to offer the single currency a rallying point today, with no change to the initial reading forecast.
Confirmation that the manufacturing sector fell deeper into contraction last month could leave EUR exchange rates on the back foot.
US dollar braces for ISM manufacturing report
The US dollar struggled to find any traction against its rivals in the wake of the Thanksgiving holiday, even as worries over the global trade outlook lingered.
USD exchange rates could edge higher this afternoon however if the IS manufacturing index shows the improvement forecast by economists.
The gauge is expected to rise from 48.3 to 49.5, taking it closer to growth territory.
Upcoming Data:
Monday, 2nd December 2019
09:00 EUR Eurozone Manufacturing PMI
09:30 GBP Manufacturing PMI
15:00 USD ISM Manufacturing 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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