Data published this morning shows that the UK Construction sector has had its worst month since October 2009. The PMI data out confirmed that the figure fell to 46.8 compared to 48.7 the previous month and anything below 50 represents contraction. This saw Sterling fall marginally this morning but as the data was close to expectation we haven’t seen too much impact for Sterling Euro exchange rates. One positive bit of information was that there was a small increase in residential activity. With the UK Budget due on 20th March all eyes will be on the Chancellor to see what changes will be made to promote growth.
EURUSD has challenged resistance levels today hitting 1.30 and staying in a tight range for most of the morning. Later this afternoon Jerome Powell from the FOMC will be talking and this could see Dollar movement this afternoon so rates for USD buyers could drop if the sentiment is positive. With GBPUSD exchange rates getting close to the lowest level seen since summer 2010 this is also having a direct impact on EURUSD which is trading at similar levels to November 2012.
There are fears that Cyprus will need another bailout which has seen the Euro lose a bit of strength this morning. There are preliminary discussions due to take place soon but the figures are very small so unlikely to have too much of an impact on exchange rates.
Data to watch out for this week
Tuesday- EUR Retail Sales due 10am
Wednesday 945am Mervyn King’s speech
Wednesday-EUR GDP Figures 10am
Thursday-Interest rates decisions for both UK and EUR
For up to date information as to how these data release will affect exchange rates feel free to contact me directly for a free quotation Tom Holian firstname.lastname@example.org