Summary:
-
Upbeat readings from European service PMIs
-
UK reading: 50.0 vs 49.1 exp
-
GBPUSD holding above $1.31
Today’s economic calendar is fairly light with the main data points coming in the form of PMI releases from across Europe. There’s a couple key events later this week with the ISM non-manufacturing PMI tomorrow one to watch before the main event Friday at 1:30PM (GMT) where we will get the release of the final US jobs report for 2019.
Start investing today or test a free demo
Open real account TRY DEMO Download mobile app Download mobile appOverall the final services PMI readings from the Eurozone are pleasing with a Euro-area wide print for December coming in at 52.8 vs 52.4 expected (prior reading was 52.4). While this may not seem too impressive by historical standards it does mark the 3rd consecutive month in which this metric has topped estimates and also means that the composite PMIs are showing some encouraging signs after sustained weakness since the start of 2018.
Having said that, the data does mean that according to these surveys the final quarter of last year was the worst since 2013 - when the bloc was in the midst of the debt crisis! The readings are also commensurate with a GDP growth figure of just 0.1% and show that economic activity in the Euro area has pretty much flat-lined.
Composite PMIs for the Eurozone are showing some potentially encouraging signs but remain low by historical standards. Source: Bloomberg
In the UK the final services PMI release for December came in at 50.0, against a consensus forecast of 49.1 and a prior reading of 49.0. Similar to the Euro area figures this is the 3rd monthly beat in a row and also means that despite 3 sub 50 prints in the past 12 months, we are yet to see consecutive readings in contractionary territory. It is also the second month running that the final readings have been revised higher from the initial flash releases, suggesting that while the UK economy is far from firing on all cylinders, perhaps things are not quite as bad as some make out. The pound has received a further small boost from this, after already beginning the week higher against all its major peers and is attempting to gain traction back above the $1.31 handle once more.
GBPUSD has gained in recent trade, aided by a better than expected services PMI print from the UK. The market is now firmly back above the $1.31 level after rising by around 70 pips in the past couple of hours. Source: xStation
The content of this report has been created by XTB S.A., with its registered office in Warsaw, at Prosta 67, 00-838 Warsaw, Poland, (KRS number 0000217580) and supervised by Polish Supervision Authority ( No. DDM-M-4021-57-1/2005). This material is a marketing communication within the meaning of Art. 24 (3) of Directive 2014/65/EU of the European Parliament and of the Council of 15 May 2014 on markets in financial instruments and amending Directive 2002/92/EC and Directive 2011/61/EU (MiFID II). Marketing communication is not an investment recommendation or information recommending or suggesting an investment strategy within the meaning of Regulation (EU) No 596/2014 of the European Parliament and of the Council of 16 April 2014 on market abuse (market abuse regulation) and repealing Directive 2003/6/EC of the European Parliament and of the Council and Commission Directives 2003/124/EC, 2003/125/EC and 2004/72/EC and Commission Delegated Regulation (EU) 2016/958 of 9 March 2016 supplementing Regulation (EU) No 596/2014 of the European Parliament and of the Council with regard to regulatory technical standards for the technical arrangements for objective presentation of investment recommendations or other information recommending or suggesting an investment strategy and for disclosure of particular interests or indications of conflicts of interest or any other advice, including in the area of investment advisory, within the meaning of the Trading in Financial Instruments Act of 29 July 2005 (i.e. Journal of Laws 2019, item 875, as amended). The marketing communication is prepared with the highest diligence, objectivity, presents the facts known to the author on the date of preparation and is devoid of any evaluation elements. The marketing communication is prepared without considering the client’s needs, his individual financial situation and does not present any investment strategy in any way. The marketing communication does not constitute an offer of sale, offering, subscription, invitation to purchase, advertisement or promotion of any financial instruments. XTB S.A. is not liable for any client’s actions or omissions, in particular for the acquisition or disposal of financial instruments, undertaken on the basis of the information contained in this marketing communication. In the event that the marketing communication contains any information about any results regarding the financial instruments indicated therein, these do not constitute any guarantee or forecast regarding the future results.