Pound Recovers Losses before Construction PMI

Published: 5 May at 10 AM Tags: Euro, Dollar, Pound Sterling, America, UK, Eurozone, Australian Dollar, New Zealand Dollar, Canadian Dollar, Australia, New Zealand, USA, Canada, France, Greece,

Pound Sterling
Ahead of the release of the UK’s latest Construction PMI the Pound was trending in a stronger position against both the Euro and US Dollar. The GBP/EUR exchange rate advanced as the ongoing Greek bailout negotiations and soft manufacturing data from France reduced demand for the Euro. However, if today’s construction number disappoints (as last week’s UK manufacturing figure did) we can expect Sterling to slide.

Euro
On Monday Markit’s Manufacturing PMI for France was negatively revised from 48.4 to 48.0, taking the gauge further below the 50 mark separating growth from contraction. Manufacturing data for Greece also fell short. This, plus the expectation that the Greek bailout negotiations will rumble on for the foreseeable future, pulled the Euro lower against the majority of its currency counterparts.

US Dollar
At the beginning of the week the US Dollar advanced in response to an unexpectedly strong Factory Orders Print and the news that the ISM New York Index advanced from 50 to 58.1. If today’s ISM-Non Manufacturing Composite and Trade Balance numbers also print well, we could see the ‘Greenback’ extend gains in the hours ahead.

Australian Dollar
Although the Reserve Bank of Australia cut interest rates to a new record low at its latest policy meeting, the belief that no further adjustments are on the horizon lent the ‘Aussie’ support. The South Pacific currency strengthened against the Pound, Euro and US Dollar during the European session despite a decline in the AiG Performance of Service Index.

New Zealand Dollar
Prior to the publication of the latest batch of employment figures for New Zealand, the ‘Kiwi’ slid against a number of its rivals. The RBA’s rate cut increased the odds of the Reserve Bank of New Zealand revising borrowing costs in the near future and pushed the New Zealand Dollar broadly lower.

Canadian Dollar
Softening oil prices weighed on the ‘Loonie’ as the week progressed and the commodity driven currency was struggling against the Pound and US Dollar but managed to advance on a broadly softer Euro.
As of Tuesday, 5th May 2015, the Pound Sterling currency rates mentioned within this news item were as follows:

GBP EUR exchange rate was 1.3569, GBP USD exchange rate was 1.5169, GBP AUD exchange rate was 1.9135, GBP NZD exchange rate was 2.0233, and GBP CAD exchange rate was 1.8325.

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