Tuesday’s trading session was a mirror image of Monday’s. The buck ground higher against many of its major peers while global stock markets continued to feel the love of central banks and governments. Cable (GBPUSD) fell towards the $1.24 handle while EURUSD sank to the $1.08 level, after piercing $1.10 to the upside on Friday. This allowed GBPEUR to jump above €1.15 before reversing.
UK data didn’t provide any surprises yesterday, both construction and services PMIs were shockingly low. With many participants already expecting such outcomes, the impact on GBP pairs was minimal. The next major test for sterling arrives on Thursday morning with the latest Bank of England monetary policy announcement.
Yesterday’s US data was a little more encouraging. Even though service sector activity slipped to its worst levels since 2009, manufacturing numbers were considerably better than forecast. This offered some hope to participants who, in return, bought into the USD, stocks, and oil.
Today’s economic calendar sees various eurozone regional PMI prints as well as a collective retail sales report. The main event data-wise will arrive at lunchtime in the form of US ADP non-farm employment. The report reflects private sector employment in the month of April. It’s set to jump from -27,000 in March to -20,050,000 last month.
Written by Viv Savani. 8:36am, May 6th 2020
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