Manufacturing PMI data captures the business conditions in the manufacturing sector. If this figure is positive for an economy then there can be a generally upbeat reaction from the markets. This morning Italy, Spain, Germany, Greece, UK and the Eurozone as a whole all release manufacturing data. The UK is expected to show an improvement on the previous month whilst Italy and Spain look likely to report weaker conditions.
The GBP/EUR rate has already started to fall away this morning moving into the 1.29’s for the first time in just over a week. If there are any surprise releases in the manufacturing conditions that could have an adverse effect on the market.
The recent spike for Sterling was off the back of an Ipsos Mori poll last week which put the Leave campaign with 55% of the vote and Remain only 37%. Yesterday the Guardian released a poll which had the Remain camp at a 52-48% lead, this has caused the market to fall nearly 2 cent since the poll was published.
Much closer than previously thought
There is a very good chance that as we approach the vote which looks a look closer than last week’s information would have everyone believe. The GBP/EUR could fall as investors move their money away from Sterling. I believe it could be possible to see the rate nearer 1.25 in the coming weeks, in the final run-up to the vote.
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