The Eurozone has had some positive news on its potential outlook against the dollar and the pound. This is due to the positive ECB news and Draghi’s unexpected change of position concerning interest rates, but also due to Italy’s recent bullish performance from its main trading partners. Both are suggesting a long term strengthening of the Euro if it continues at this rate. Across the pond the US celebrated the 4th of July independence day, which meant news and activity was relatively quiet.
Some alarming news yesterday from Asia was North Korea’s successful launch of a rocket that can carry nuclear warheads. This made the US and Japan very uneasy as this successful test demonstrated North Koreas nuclear weapons progression, and also made them seem even more unpredictable.
The third and final reading of UK PMI is released today. Typically this piece of data has the greatest impact in the market as the tertiary sector accounts for nearly 80% of UK output. Services PMI is forecast at 53.5, in line with May’s reading. However, construction and manufacturing this week both failed to meet the consensus, if this is to follow suit expect to see further Sterling weakness this morning.