1st June 2017 Market Update
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?? GBP – The pound is trading on the defensive in the second half of the week, as an innovative new polling system suggested that the Tories could even lose seats on June 8th. Mortgage approvals figures for April also weighed on the pound, coming in worse than expected.
UK Manufacturing PMI data this morning is the salient event of the day, with the consensus being that we may just hold onto last month’s gains. As ever, significant deviation could cause the pound to move.
?? EUR – Inflation data for May disappointed yesterday, but failed to have an impact on euro value. The currency is very much benefiting from Sterling weakness and dollar uncertainty. There is also the ongoing perceived stability in the zone, brought by Macron’s election in France and the real possibility that Angela Merkel could win again this year.
Today also sees Manufacturing PMI data for the single-bloc, though it is unlikely to have much of an impact.
?? USD – President Trump continues to stumble along, with incomplete, unintelligible tweets and distinctly unstatesmanlike rhetoric. It would appear that the jury is still undecided with regards to any real economic progress that he can make and there is no doubt that the dollar has, potentially, a long way to fall.
Yesterday saw a raft of data such as Pending Home Sales, Beige book and Chicago Purchasing Manager’s Index. Whilst not particularly good, it did little to impact the currency.
09:30 – Manufacturing PMI (May).
09:00 – Manufacturing PMI (May).
13:30 – US Jobless Claims.
15:00 – Manufacturing PMI.
15:00 – ISM Prices Paid (May).
Our View: It is very much a waiting game for Sterling until June 8th. The currency may well remain very much on the back foot for the next week or so.
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