Pound Sterling (GBP)
After a flat UK data day on Monday, the Pound rallied on Tuesday morning, thanks to December’s manufacturing PMI.
While forecasts had been for a slight decline from 53.6 points, the actual result saw a surprising rise to 56.1.
This triggered a burst of optimism among Sterling investors, sending the Pound soaring against most of its regular peers, including the Euro.
Looking ahead, Wednesday morning is set to bring December’s construction PMI, which has a potentially GBP-supporting rise predicted from 52.8 to 53.2.
Demand for the Euro today has been low across the board, with the single currency sliding against peers due to concerns about how 2017’s key European elections might turn out.
With the cheer and haze of Christmas and New Year now fading away, investors have been looking ahead to the coming French and German elections.
Far right parties have been gaining support during the upset-riddled previous year, so observers remain on edge that 2017 could see further political unrest and upheaval.
Domestic data out of the Eurozone has been positive so far, with Germany reporting a larger-than-expected drop in number of unemployed persons in December.
Germany will remain in focus later today, with the national inflation rate result for December due in the afternoon. An annual rise has been forecast, from 0.8% to 1.2%.
US Dollar (USD)
US Dollar interest has risen overall during trading today, although investors remain on edge about how President-Elect Trump may cause wild shifts in US economic outlooks when he takes office officially later this month.
The last US data to refer to came on December 30th, consisting of a drop in the Chicago PMI for December and a rise in the Baker Hughes oil rig count for the same month.
This afternoon will bring the finalised Markit US manufacturing PMI, as well as the ISM manufacturing PMI, both for December. In both cases, slight rises are forecast.
Australian Dollar (AUD)
The year so far, brief as it is, has been positive for the Australian Dollar, with AUD advancing across the board in the wake of Monday’s AIG manufacturing index for December rising instead of falling as expected.
Further AiG input is due this week from December’s services index figures, which are expected to show a dip from 51.1 points to 50.2 during Wednesday night.
New Zealand Dollar (NZD)
Unlike its antipodean neighbour, the New Zealand Dollar has been a mixed option for investors for the week so far.
NZD has remained an uncertain bet in the wake of Prime Minister John Key’s resignation last year; his successor, Bill English, remains an untested figure at the helm, which has left doubts among investors about how he will steer the nation in the future.
This afternoon will bring the key Global Dairy Trade price index results, which previously showed a drop in milk prices by around -0.5%.
Canadian Dollar (CAD)
The Canadian Dollar has been a stable currency against its peers overall today, although a minor slip against the stronger Australian Dollar has nonetheless been recorded.
The most consistent source of influence on CAD lately has been the price of gold and crude oil; respectively, a slight drop and sizable rise have been recorded over recent weeks.
Incoming Canadian data will cover the RBC manufacturing PMI for December, which is expected to shift upwards slightly on the month.