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Will UK services PMI push GBP away from six-month high?

business-articlesWill UK services PMI push GBP away from six-month high?
  • Pound rises as the Conservatives maintain their lead in the polls
  • US dollar stumbles after Trump’s latest trade threats
  • Escalating trade anxiety undermines Canadian dollar 
Pound climbs before UK services PMI 
As the latest poll indicated that the Conservatives are maintaining their lead ahead of next week’s general election the mood towards the pound improved, with the currency edging closer to a six-month high.
However, GBP exchange rates could still come under pressure this morning on the back of the finalised UK services PMI for November.
Confirmation that the service sector dipped into contraction territory last month could limit the potential for further pound gains.
Intensifying global trade worries weigh on US dollar
The latest comments from the Trump administration prompted a fresh wave of anxiety over the global trade outlook.
Markets were spooked by the threat of fresh tariffs on a range of French produce as well as the suggestion that the US is in no hurry to secure a trade deal with China before the 2020 election.
As trade tensions have already shown signs of weighing on US economic growth, the prospect of further disruption put pressure on the US dollar.
But as forecasts point towards another strong month for the ISM non-manufacturing composite index USD exchange rates could find a rallying point this afternoon.
BOC decision could boost Canadian dollar
Market trade jitters put pressure on the Canadian dollar yesterday, with oil prices also falling in response to the reduced odds of an imminent US-China trade agreement.
CAD exchange rates could find a stronger footing today, however, if the Bank of Canada (BOC) takes an optimistic tone at its latest policy meeting.
While no change in interest rates is expected at this stage markets could still take encouragement from signs that the BOC is adopting a neutral policy outlook. 
Upcoming Data:
Wednesday, 4th December 2019
09:30 GBP Services PMI
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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