GBPUSD hit fresh 30 day lows yesterday following strong USD economic data with EURUSD not too far behind. The data showed a better than expected decline in June’s ISM manufacturing index, printing a figure of 60.6. This follows the shock news from the Fed last month regarding a tightening of monetary policy, introduced as a response to the global pandemic. As a result, the market is now looking towards key employment data from the US later on today.
The Non-Farm payroll figure is expected to be printed at 700k against a previous of 559k. Should this deliver, the Federal Reserve’s hawkish stance of an earlier than expected increasing of interest rates will then be reinforced. Along with the NFP figure, we also have both the average hourly earnings and unemployment rate for the US, both of which are forecast to be printed better than previous at 0.3% and 5.6% respectively.
In the UK, all eyes are focused on the new Health Secretary Sajid Javid and his guidance on lifting lockdown in England by the 19th of July. With the situation as fluid as ever, GBP is teetering and playing second fiddle to the greenback until further certainties are delivered, which will give sterling the much-needed boost to regain some of the lost ground against the dollar.
The data front today is somewhat thin outside of the key USD data as mentioned above.
Have a great weekend.
Author: Joshua Nagenthiran, Senior Relationship Manager
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