3rd July 2018 Market Update
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?? GBP – UK manufacturing ticked higher to 54.4 in June from 54.3 in May but there was a tone of caution from the details in the data. Growth in new orders slowed and companies increased raising their output to fulfil older orders or to build up inventory, pointing to a lack of confidence amongst manufacturers. Sterling dropped off the back of the data with investors now looking to other factors for a pickup in economic activity for the UK.
Today sees the release of construction PMI’s, expected to be unchanged from May’s figure.
?? EUR – Manufacturing PMI’s from the single bloc also painted a worrying picture with growth at its slowest in 18 months. The figure dropped from 55.5 to 54.9 in June.
The data seems to reveal mounting worries over trade wars and tariffs with export orders continuing its trend for 2018 of dropping with further declines suggested by analysts.
In focus today will be retail sales for June suggesting a year on year drop from 1.7% to 1.5%.
?? USD – In contrast US manufacturing picked up as factories brushed of worries of trade wars. Both agencies Markit and ISM showed a pick-up to 55.4 and 60.2 respectively up from 54.6 and 58.7.
The data continues to add to the solid numbers we’ve seen from the US throughout the course of the year cementing the US dollar’s position against its peers.
Today sees the release of factory orders.
09:30am: PMI Construction – Expected to remain at 52.5
10:00am: Retail Sales – Expected to drop to 1.5%
14:00pm: Factory Orders – Expected to come in at 0.0%
Summary: Yesterday saw a slew of manufacturing data from both sides of the Atlantic with the highlight being a pickup in activity in the UK, but there was a tone of caution from the details in the data.
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