Daily Market Update

Pound Rises on Manufacturing, but U.S. Dollar Steady after ADP

November 01, 2017

The U.S. Dollar is trading in mostly positive ranges with the exception of losing over half a percent to the British Pound.

USD

Overnight trading did not impact FX markets tremendously despite a slew of data from commodity-based economies. If anything, market watchers are eagerly waiting for tomorrow, a big Thursday in which we shall know if Janet Yellen remains head of the Fed after February as well as getting actual written proposals of tax reform from congress. Although there may be some discord between legislators, it seems the production of a bill will satisfy markets and this could propel the dollar further as the week comes to a close.

ADP Employment Report figures satisfied earlier this morning with a reading of 235K added jobs, exceeding the 200K estimate for October. The positive data certainly cemented the dollar’s strong footing and we could see a further boost if ISM Manufacturing and Construction Spending numbers paint a good picture at 10AM.

EUR

The Euro is currently around its lowest levels since mid-July, but not bleeding as much as it has in recent days after concerns faded over the Catalunya call for independence from Spain. It seems like the parties pushing for separation have met their match with the Spanish government utilizing all of the constitutional powers to quell dissidence. Not a lot of heavy data for the remainder of the week nor major events scheduled make the Euro susceptible to headlines here in the U.S.

GBP

Sterling reached its strongest level in a month after Markit PMI Manufacturing was stellar and revised upward for the prior month. Manufacturing registered an expansion reading of 56.3 over the predicted 55.9, signifying an impressive level of economic health that may set for a hawkish tone at the Bank of England meeting tomorrow.

Their almost-guaranteed interest rate hike will be the first time the central bank tightens in a decade. Brexit worries remain, but the lawmakers involved in negotiations are looking to promote more frequent meetings and advance their agendas, which is currently interpreted as a Pound-positive.

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