Services PMI Figures Beat Expectations

After Eurozone, UK and US services PMI figures beat expectations yesterday, traders are likely to focus on the potential impact on GDP figures from yesterday’s releases. The major pairings are likely to be rangebound today in light of the sparse economic calendar.

Previous Day's Market Highlights

We started the day with the AUD on the back foot with both Net exports and Current Account balance missing forecasts quite considerably, this saw GBP/AUD up 0.9% during the London trading session.
Following this we saw the Eurozone PMI print as expected, however the UK Services PMI came out at 54 compared to the forecasted 53, this caused sterling to start the day on the front foot against both the GBP/USD and GBP/EUR currency parings. We saw GBP/USD up 0.5% at the end of the day  and GBP/EUR up 0.3%, the EUR support was short lived from this due to the newly appointed Italian Prime Minister Giuseppe Conte unveiled the new coalition governments agenda in an address to the Senate, this comes ahead of a confidence vote which they are expected to win.
EUR/USD jumped back above the 1.17 mark following the ECB announcement that they will discuss their Quantitive Easing Exit next week, the ECB will have a live debate on QE exit in its June 14th meeting. The pair was supported on the concerns about Trump’s trade plans to split NAFTA and other measures.
Finally, the Canadian Labour Productivity came out weaker than expected at -0.3% compared to the forecasted -0.2%. US USM Non Manufacturing PMI came out better than expected printing 58.6 up from the forecasted 56.8

Currency Pairing 08:00 Today Vs 08:00 Yesterday Four-Week High Four-Week Low % Change
GBP/EUR 1.1418 1.1478 1.1302 1.53%
GBP/USD 1.3417 1.3619 1.3204 3.05%
EUR/USD 1.1759 1.1996 1.1510 4.05%
GBP/AUD 1.7533 1.8241 1.7518 3.96%
GBP/NZD 1.9053 1.9702 1.8927 3.93%
GBP/CAD 1.7366 1.7567 1.7055 2.91%

Today's Market Highlights

A quieter day on the economic calendar today sees the only highlight of the morning session being a speech from BoE MPC Member Tenreyro. Sterling traders will keep a keen eye on hints of the direction of future monetary policy from the Bank, the market is currently pricing around a 40% chance of a rate increase in August – hawkish comments today would likely increase that probability.
The afternoon session is slightly busier, beginning with the release of Canadian trade balance for last month, this is expected to show a deficit of 3.4bln CAD. The trading session is completed with the release of weekly US Crude Oil Inventories expected to show a draw of 2mln barrels compared to the previous week. This release tends to affect the Canadian Dollar due to their sizeable energy sector.

Today's Economic Calendar

Time Currency Release Consensus Previous
09:10 EUR Retail PMI (May) 48.6
13:30 CAD Trade Balance -3.4B -4.1B
15:30 USD Crude Oil Inventories -2.0M -3.6M