Author Archives: Ricky Kielkowski

US election dollar impact 2024 announcements this week
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Money News Overview Thursday 4th January 2024: UK services PMI to reach 6-month high

Economic data released earlier this morning showed inflation in France has increased to 3.7 percent. EU-harmonised inflation also increased to 4.1 percent.

Purchasing Managers Index figures in the services sector dominate this morning’s data and are set to be released in Spain, Italy, France, Germany and the European Union.

The Euro has been on a downward trend against the Pound this week. A better-than-expected EU PMI release across the board will show signs of support for the Euro.

Markets are forecasting UK PMI figures in the services sector to release at 52.7, remaining above the neutral 50 mark for the second consecutive month. This release demonstrates an expansion in the UK services sector and is a positive for the UK economy.

Inflation in Germany is anticipated to shadow the CPI release in France earlier this morning and also rise to 3.7 percent year-on-year.

This afternoon, US employment figures round off the day. The most significant release is forecasting the monthly change in US employment to rise to 115k.

Investors will keep a close eye on the EU inflation release tomorrow. The total number of goods and services purchased by consumers in the European Union is set to surge to 3 percent.  

German CPI Inflation and UK GDP: Key Market Indicators for Investors
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Money News Overview Wednesday 3rd January 2024: Dollar in the ascendancy

In terms of currency, the dollar was on the rise. After being on the back foot for much of the holiday season, the dollar gained 0.8% against the euro, pound, and yen yesterday. The dollar benefited from the risk-averse environment.

Today’s US data releases include the December ISM manufacturing index. For the 13th month in a row, it remained below the critical 50 mark, indicating a contraction in activity. That is likely to have continued in December, though the rate of decline may have slowed

The November JOLTs survey of labour market turnover will also be issued, offering more insight on labour market conditions in the aftermath of stronger-than-expected job growth. Elsewhere on the data schedule, there are no significant releases in the UK.

The current Fed meeting minutes will be closely scrutinised in terms of monetary policy. Following Chair Powell’s dovish remarks at the December meeting, a 150 basis point rate cut is anticipated before the end of the year.

However, unless there are huge surprises, the data or meeting minutes are unlikely to affect the dollar.

With no significant economic data scheduled for today, market attention will shift to key UK data releases later in the week.
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Money News Overview Tuesday 2nd January 2024: PMI releases dominate the start of the year

A new year begins with a flurry of PMI releases across Europe and the UK, with markets forecasting the UKs manufacturing sector to fall to 46.5 from 47.2. This remains well off the 50-point figure that markets use as a benchmark indicator to see if there is growth in the that specific sector.

Later this week, there are some key inflation figures being released in Europe with German inflation data being released on Thursday. Markets expect inflation to rise to 3.8 percent which is an increase of 0.6 percent.

Alongside the release of German inflation, the eurozone will release their figures which markets are also expecting inflation to rise to 3 percent, up from 2.4 percent. This potentially signals that the rate cuts the European Central Bank have been implementing are yet to take full effect.

On Friday, markets also see the release of US Employment figures along with their ISM Non-Manufacturing Survey.

On the currency front, the pound has started the new year on the front foot against both the dollar and the euro, with the pound toying with 5-month highs against the dollar.

Pound vs Euro exchange rate reaction to tariffs
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Money News Overview Friday 22nd December 2023: UK retail sales rise in November

The final UK Gross Domestic Product release this year, showed the total value of goods and services produced in the third quarter of 2023 decreased by 0.1 percent increasing the likelihood of a recession.

UK retail sales increased 1.3 percent in November, with Black Friday sales boosting this figure.

The total value of sales by retailers in the UK, excluding fuel released at 1.3 percent in December, jumping 0.7 percent from the forecasted 0.4 percent rise.

The Pound has been on a downward trend against the Euro, after UK inflation figures released lower than expected at 3.9 percent earlier this week – placing pressure on the Bank of England to cut interest rates promptly.

This afternoon, there is a mixture of US economic data that investors will keep a close eye on throughout the day.

Pound rises as dollar hits 3-year low
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Money News Overview Thursday 21st December 2023: It’s beginning to look a lot like…rate cuts

The British Pound dropped swiftly following the release of UK inflation figures that were lower than expected, but there are reasons to assume that losses can be limited.

The unanticipated drop in headline CPI inflation to 3.9% year on year was the type of surprise that may significantly impact expectations for the UK economy and interest rates.

Markets anticipate the Bank of England to act quickly to lower inflation, with over 125 basis points of rate reduction expected in 2024, with the first cut priced in as early as March.

US Consumer Confidence Index increased more than expected in December. The index increased from 101.0 to 110.7, surpassing the 104.0 consensus. Existing-home sales unexpectedly increased in November. Both data reports raised expectations that the US economy will continue to thrive strongly in 2024. 

Today’s key data releases are from the United States, in the form of weekly unemployment claims and the Philly Fed Business Survey. However, unless there are any huge shocks, the figures are unlikely to have an impact on markets.

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