The pound plummeted on Tuesday as the latest UK PMIs printed well below expectations.
The pound, meanwhile, is mostly rangebound so far this morning, with GBP/EUR flat at €1.1889 and GBP/USD muted at $1.3373. GBP/CAD and GBP/AUD are holding steady at C$1.6960 and AU$1.8518 respectively, while GBP/NZD rallies to NZ$1.9340.
Coming up, will some hawkish minutes from the Federal Reserve’s latest policy meeting help to bolster the US dollar later this evening?
The euro traded with modest gains yesterday, after the latest Eurozone PMIs printed above forecast, with the bloc’s manufacturing and services sectors both experiencing stronger-than-expected growth this month.
What’s been happening?
The upbeat PMI releases helped to bolster expectations for fourth quarter growth in the Eurozone.
The US dollar also strengthened yesterday, with the safe-haven currency benefiting from risk-off flows as well as growing Fed rate hike speculation following the reappointment of Jerome Powell as Fed Chair at the start of the week.
Meanwhile, the pound struggled to attract support on Tuesday, amidst waning confidence that the Bank of England (BoE) will hike interest rates in December, which offset the UK’s own, above forecast PMI releases.
Looking ahead, a slew of USD data releases are likely to dominate trade today, with several releases being published early due to Thanksgiving.
What’s coming up?
Perhaps the most influential release will be the publication of the FOMC minutes from the Fed’s November policy meeting, as USD investors will be looking to see if there is any appetite within the bank to accelerate the US central bank’s current tightening cycle.
In the meantime, the euro could face some headwinds this morning, if Germany’s latest IFO business climate index reports another deterioration in business morale this month.
For GBP investors the focus is likely to be on the Confederation of British Industry’s (CBI) industrial trends orders release. Will an acceleration of order growth in November reflect positively on Sterling?
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)