Sterling Slips as Markets Await Wednesday’s Key Services PMI Reports

Published: 2 Feb at 5 PM Tags: Euro, Dollar, Pound Sterling, America, UK, Eurozone, Australian Dollar, New Zealand Dollar, Canadian Dollar, Australia, New Zealand, USA, Canada,

Pound Sterling (GBP)

The Pound saw mixed movement today. While Sterling initially continued to benefit from UK coronavirus vaccine hopes, the British currency ultimately weakened again as markets anticipated tomorrow’s UK services PMI report.

Tomorrow will see the publication of some of this week’s key UK services PMI data from January. Weaker than expected services data would weigh on the UK economic outlook and potentially cause the Pound to shed some of its recent strength.



Euro (EUR)

While today’s Eurozone growth rate report beat forecasts, the Euro still saw mixed movement throughout the day. Investors sold the Euro as its rival the US Dollar strengthened, as the Eurozone outlook remained gloomy on coronavirus vaccine concerns.

Eurozone services and composite PMIs will be published tomorrow. If this data is strong or there are any signs of progress in Eurozone vaccine rollout, the Euro could see steadier demand again.



US Dollar (USD)

The US Dollar continued its recovery rally today, surging against both the Pound and Euro. Investors bought the US Dollar due largely to rival weakness and profit-taking as the currency rebounded from recent lows.

US non-manufacturing PMI from January will be published tomorrow. If the data beats expectations, it could help the US Dollar to continue its current recovery rally.



Australian Dollar (AUD)

The Australian Dollar tumbled today, as investors reacted to the latest Reserve Bank of Australia (RBA) policy decision. The bank took a more dovish tone, introducing more quantitative easing (QE), which caused AUD losses throughout the day.

Australian services and composite PMIs will be published tomorrow, and RBA Governor Philip Lowe will hold a speech. Any surprises here could influence AUD movement in the coming sessions.



New Zealand Dollar (NZD)

The New Zealand Dollar benefitted from slightly better market sentiment and weakness in its rival the Australian Dollar today, making it one of the more appealing risk-correlated currencies on the market.

New Zealand’s key Q4 job market report will be published during Wednesday’s Asian session. Strong job stats could keep the New Zealand Dollar broadly appealing.



Canadian Dollar (CAD)

Prices of oil, Canada’s biggest export, continued to strengthen today. While the Canadian Dollar has been driven less by oil in recent sessions, this combined with recently strong Canadian data kept the Canadian Dollar fairly appealing overall.

Canadian Dollar movement will be driven mostly by oil prices and risk sentiment until Friday, when Canada’s latest job market report will be published.
As of Tuesday, 2nd February 2021, the Pound Sterling currency rates mentioned within this news item were as follows:

GBP EUR exchange rate was 1.1347, GBP USD exchange rate was 1.366, GBP AUD exchange rate was 1.7955, GBP NZD exchange rate was 1.898, and GBP CAD exchange rate was 1.7467.

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