Pound Hit as Brexit Hits UK Construction Sector
5th March 2019 Market Update
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?? GBP - Brexit uncertainty reared its ugly head again as data revealed that the construction sector contracted for the first time in 11 months down to 49.5. Risk aversion and delays in decision making has caused a slowdown on workloads as well as subdued client demand on commercial projects.
Sterling fell on the back of the data all be it a minor loss on the day. Today see’s services PMIs expected to also show a contraction in the sector which could further dent GBP hopes today.
?? EUR - Following Friday’s credit rating upgrade by Moody’s, Greece has announced that they are preparing a new 10-year bond issue. This shows investors believe that Greek debt is a safer bet. However, this seemed to have very little positive influence on the euro, with the single-bloc currency suffering due to risk aversion.
We have services PMI’s also from the Eurozone, forecasted to remain unchanged at 52.3.
?? USD - The dollar continued to rise for the fifth consecutive day due to its safe-haven status. With the euro dropping as well as stocks suffering later in the afternoon, markets took a risk averse attitude and seemed to look past the remarks made by President Trump that the “US dollar is too strong”. However, analysts still remain cautious in chasing the strength of the US dollar on account of the Fed’s ‘wait and see’ approach for further rate hikes.
Services and non-manufacturing PMIs are due for release today forecasted to come in slightly higher which could bode well for the dollar once again.
GBP: Construction PMI’s show contraction for first time in 11 month
EUR: Greece Prepares 10-year Bond Sale after credit rating hike.
USD: US dollar gains on safe-haven flows as stocks drop
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