Pound (GBP) directionless after latest PMI figures
The pound (GBP) struggled to establish a clear direction yesterday as markets assessed the UK’s final PMI figures.
The latest data showed that growth across the UK’s crucial services sector was weaker than first estimated in October, although activity still expanded at its fastest pace since February.
Looking ahead, attention turns to the Bank of England’s (BoE) latest interest rate decision today. An anticipated rate hike could provide support for Sterling, although the bank’s forward guidance is likely to be a key consideration for GBP investors.
Euro (EUR) mixed despite weaker US dollar
The euro (EUR) also traded without a clear direction yesterday, despite receiving some support from its strong negative correlation with the declining US dollar (USD).
Disappointing Eurozone PMI figures restricted EUR’s gains, while the latest inflation data from the bloc had little impact on the currency after coming in line with expectations.
Today’s German factory orders figures could offer support to the euro after confirming a recovery in September. A forecast increase in Eurozone PPI for the same month may also provide a lift.
US dollar (USD) weakens after mid-term election outcome
The US dollar fell yesterday after the Democrats secured control of both chambers of Congress, winning the Senate and the House of Representatives in the mid-term elections.
Further pressure came from improving market sentiment and growing hopes that the US-Iran conflict could be resolved through diplomacy.
With the immediate uncertainty surrounding the elections beginning to subside, USD investors may shift their attention to today’s latest US initial jobless claims figures. If new claims for unemployment benefits remain subdued, the US dollar could find some support.
Canadian dollar (CAD) retreats as crude prices fall
The commodity-linked Canadian dollar (CAD) moved lower yesterday as a decline in oil prices weighed on the currency.
Looking ahead, crude price movements could continue to dictate CAD’s performance today, with further weakness in oil potentially dragging the ‘loonie’ lower.
Australian dollar (AUD) steady despite strong trade data
The Australian dollar (AUD) traded within a narrow range overnight, with stronger-than-expected Australian trade figures failing to provide a meaningful boost to the ‘Aussie’.
New Zealand dollar (NZD) edges higher as risk appetite improves
The New Zealand dollar (NZD) made modest gains during Thursday’s Asian session as an improvement in market risk appetite helped support the currency.
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