Daily Market Report – 02/06/2015

GBP
The pound had a bad start to the
week with the manufacturing PMI coming in less than expected, showing a reading
of 52.0 against a 52.5 consensus. Following the reduced growth figures last
week, the outlook for the UK economy still remains positive but recent data
shows the outlook is not as positive as analysts had hoped for.

A UK Manufacturers group (EEF), lowered their 2015 manufacturing output growth
forecast to 1.5% from 1.7%. The pound yesterday lost ground against all of its

GBP
The pound had a bad start to the
week with the manufacturing PMI coming in less than expected, showing a reading
of 52.0 against a 52.5 consensus. Following the reduced growth figures last
week, the outlook for the UK economy still remains positive but recent data
shows the outlook is not as positive as analysts had hoped for.

A UK Manufacturers group (EEF), lowered their 2015 manufacturing output growth
forecast to 1.5% from 1.7%. The pound yesterday lost ground against all of its
major counterparts, with GBP/USD now falling for 7 days in a row, dropping a
total of 485 points (3.1%).

USD
The USD once again continued its
strong trend yesterday as we headed into the afternoon session. ISM
manufacturing PMI coming in at 52.8 against a 52.0 consensus. This is the first
time that the ISM manufacturing has beaten the month-on-month consensus since
December 2014, and with the Markit manufacturing coming in at 54 from a
preliminary 53.8, the signs are that manufacturing in the US is making firm
progress. Other pieces of note saw the personal income figure in at 0.4%
against a 0.3% consensus, and the personal spending coming in flat at 0%. USD
index has showed an increase of 0.7% yesterday, which is in fact the 5th
consecutive day of gains for the index. Fed Vice Chair Stanley Fischer also
spoke yesterday, outlining that the central bank’s research said there wouldn’t
be much difference between moving earlier for a hike vs moving later. After
positive jobs and wage data in the last month combined with a slow recovery in
inflation, Mitsubishi UFJ Financial Group forecast that the Fed will announce a
rate hike at their June 17th meeting, 

EUR
Yesterdays data showed
euro-zone manufacturing PMI still above the 50 mark, coming in at 52.2
against a 53.3 consensus. However the German manufacturing PMI being the
largest disappointment, coming in at 51.1 against a 51.4 consensus. This is a
0.3 reduction from the preliminary figure of 51.4 two weeks ago, however
positive CPI figures did not create any concern.

There wasn’t much concrete information surrounding Greece yesterday, however
rumours of them missing their EUR300m IMF payment on Friday were still
circulating. Reports were circulating yesterday that a deal would be announced
between Greece and the Eurogroup, however this failed to materialise. Sources
reported that EU officials are going to meet to discuss potential arrangements
and further plans for Greece in Berlin and present in the coming days. 

Key Announcements

09:30 – GBP – Construction PMI is forecast to increase

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