USD trades lower; Chinese manufacturing lifts risk
City Index June 23, 2014 3:16 PM
<p>USD is trading lower across the board this morning following the release of the HSBC manufacturing PMI reading for June, which came in at a […]</p>
USD is trading lower across the board this morning following the release of the HSBC manufacturing PMI reading for June, which came in at a seven-month high at 50.8 from 49.4 in May.
The details of this report showed that strength was broad based across the manufacturing sector as analysts sighted that the relatively small lending stimulus initiatives that the Chinese Government have undertaken recently have buoyed the Chinese economy.
As you’d expect, the main beneficiaries to the stronger data have been the CNH, AUD, NZD and CAD – with the latter adding further gains against the greenback following a strong domestic reading in Canada on Friday. The latest inflation reading revealed a 0.5% month-on-month increase, taking the yearly headline reading to 2.3%.
In other news, geographic concerns remain elevated in Iraq as media reports suggest that ISIS have taken control of some major westerns borders and the US suggests air strikes are an option as they look to address the unrest.
The proud pound trades back to 2009 highs as MPC member, David Miles, signals rate normalisation is likely to start in his final year at the old lady (BoE). He cited a UK recovery becoming entrenched, although added that the stimulus of low rates doesn’t need to be removed just yet because slacks in the economy are still present as low wage settlements remain.
Today the attention will continue to focus on PMI data from Europe and the US.
Supports 1.3580-1.3550-1.3505 | Resistance 1.3625-1.3650-1.33675
Supports 101.65-101.40-100.75 | Resistance 102.15-102.50-102.85
Supports 1.7005-1.6970-1.6925 | Resistance 1.7055-1.7100-1.7140