Pound (GBP) weighed down by softer PMI
The pound (GBP) came under pressure yesterday after the UK’s services PMI fell short of expectations.
The survey registered 51.7 in September, down from 52.5 in August and below forecasts of 52, signalling a sharper-than-anticipated slowdown across the UK’s crucial services sector.
Looking ahead, the latest Confederation of British Industry’s (CBI) distributive trades survey could exert some pressure on the pound. However, as a mid-tier release, it is unlikely to trigger significant GBP losses.
Euro (EUR) supported by upbeat PMIs
The euro (EUR) strengthened against its weaker counterparts yesterday after September’s manufacturing and services PMIs for the Eurozone both surpassed expectations.
However, the single currency struggled against its stronger peers, as its negative correlation with the strengthening US dollar (USD) weighed on EUR.
Today, an improvement in Germany’s business climate index could provide some support for the euro after the reading exceeded forecasts in September.
US dollar (USD) advances as PMIs exceed forecasts
The US dollar moved higher yesterday as markets increased their expectations for a more hawkish approach to monetary policy from the Federal Reserve.
Expectations for a hawkish Fed were strengthened in the afternoon after the latest S&P Global PMIs comfortably exceeded forecasts, pointing to the quickest expansion in private sector activity since July 2021.
Risk appetite could influence the US dollar today as markets monitor geopolitical developments during the ongoing UN General Assembly session.
Canadian dollar (CAD) rallies as oil prices recover
The crude-linked Canadian dollar (CAD) strengthened yesterday as oil prices recovered after declining through most of the week.
Today, an anticipated rebound in Canadian retail sales for August could lend support to the ‘loonie’. However, the currency could come under pressure if oil prices resume their recent decline.
Australian dollar (AUD) slips as unemployment rises
The Australian dollar (AUD) edged lower overnight after Australia’s unemployment rate unexpectedly increased in August.
New Zealand dollar (NZD) subdued amid cautious sentiment
The New Zealand dollar (NZD) traded within a narrow range overnight as cautious market sentiment weighed on the risk-sensitive ‘kiwi’.
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