Mixed PMI data from Asia ahead of UK & EU releases
City Index August 5, 2014 2:44 PM
<p>The FX markets are suffering from a non-farm payrolls hangover as we await our direction from central bank meetings later this week. The dollar trades with […]</p>
The FX markets are suffering from a non-farm payrolls hangover as we await our direction from central bank meetings later this week. The dollar trades with a mixed tone, supported against the euro following IFO suggestions that EU sanctions on Russia will cause a flat German growth reading this year whilst trading slightly negatively against sterling and the JPY.
The Asian session has failed to spark life into FX despite the Chinese HSBC Service and Composite PMI dropping to its worst reading since the data was collated back in November 2005. The reading just about remained in expansion territory at 50 from the previous reading of 53.1. In the first of the central bank meetings this week the Reserve Bank of Australia maintained the cash rate at 2.5% whilst leaving the accompanying statement pretty much unchanged as they view a period of steady interest rates with inflation likely to remain in the 2%-3% target range.
The BoJ policy meeting will begin tomorrow, with media in Japan suggesting that members are concerned of the effects the sales tax hike is having on the economy and in particular if they should change their policy statement to reflect the bank’s concerns on production and exports.
The PMI data releases continue today with composite service sector readings from the EU and UK along with retail sales data from the former area also due for release. The US session will bring us factory orders data along with the latest non-manufacturing ISM survey.
Supports 1.3395-1.3365-1.3295 | Resistance 1.3445-1.3475-1.3505
Supports 102.25-101.95-101.65 | Resistance 102.75-103.05-103.50
Supports 1.6835-1.6800-1.6760 | Resistance 1.6885-1.6925-1.6985