Brexit, supply chain issues, the pandemic, sustainability and health and wellness concerns look to steer food industry trends in 2022, according to UK news source foodmanufacture.co.uk.
- Pound stable ahead of manufacturing PMI
- Weak Eurozone inflation pressures euro
- US dollar dominant despite consumer confidence decline
UK manufacturing PMI could weaken Sterling
An unexpectedly strong increase in UK mortgage approvals helped fuel the pound’s recovery ahead of the weekend.
However, this positivity could soon fade if August’s manufacturing PMI fails to show any significant improvement on the month.
If the manufacturing sector remains in a state of contraction it would not bode well for the UK economic outlook.
GBP exchange rates are likely to weaken if investors see any fresh reason to bet on the prospect of an imminent recession.
Weak Eurozone inflation weighs on euro
The euro weakened on Friday as the Eurozone consumer price index continued to fall some way short of the European Central Bank’s (ECB) inflation target.
With inflation failing to pick up the ECB looks set to cut interest rates and potentially reinstate its quantitative easing programme at its September policy meeting.
Support for EUR exchange rates is unlikely to increase this morning with the finalised Eurozone manufacturing PMI for August forecast to remain in contraction territory.
Unless the PMI sees a positive revision demand for the single currency is unlikely to see any major improvement today.
US dollar shakes off weakening consumer confidence
While the University of Michigan consumer confidence index saw its largest fall in six years on Friday this was not enough to drag the US dollar lower.
Even though this sharp decline suggests that consumers are feeling the pinch from the ongoing US-China trade dispute markets remain optimistic that trade relations are on course to improve.
However, if US and Chinese officials fail to maintain a cordial tone this could see the US dollar come under renewed pressure as worsening trade conditions could force the Federal Reserve to adopt looser monetary policy.
Monday, 2nd September 2019
09:00 EUR Eurozone Manufacturing PMI
09:30 GBP Manufacturing PMI
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