London Session Forex Recap – Apr. 1, 2015

  • Swiss Manufacturing PMI: 47.9 vs. 47.5 forecast, 47.3 previous
  • German Manufacturing PMI: 52.8 vs. 52.4 forecast, 52.4 previous
  • European Manufacturing PMI: 52.2 vs. 51.9 forecast/previous
  • U.K. Manufacturing PMI: 54.4 vs. 54.4 forecast, 54.0 previous

Today we’ve got choppy forex price action that’s giving us a wide variety of directional moves thanks to a blanket of better-than-expected manufacturing PMI data and U.K. election speculation from the European region.  The big surprise may be in the British pound which–despite another positive read to continue the trend higher in manufacturing PMI–drew in sellers quickly after the data was released.

The likely cause may be speculation on the outcome and potential consequences of the upcoming national U.K. elections, which have some seeing potential exit of Britain from the EU and how that would likely damage the business sector. Whatever the case may be for Sterling, it’s been a mildly rough session against most majors but the pressure seems to have abated for now:

GBP/USD is down 35 pips (-0.24%) to 1.4777, GBP/USD is down 49 pips (-0.28%) to 177.42, GBP/CHF is down 87 pips (-0.61%)

On the other side of the water, the euro is having a pretty positive day, likely on the steady stream of better-than-expected monthly manufacturing PMI data, and with the broad European number hitting 52.2, a level not seen since May 2014.  With the data looking rosy today and no major, ominous developments from the Greek debt negotiations, the euro seem to have easily found a bid and steadily grinds higher on the session:

EUR/USD is up 17 pips (+0.17%) to 1.0748, EUR/GBP is up 35 pips (+0.49%) to .7277, and EUR/JPY is up 26 pips (+0.20%) to 129.10

The forex calendar for the Wednesday afternoon London/morning U.S. session is filled with its own manufacturing sentiment data, as well an early indication of what we may see from this Friday’s NFP number.

At 12:15 pm GMT, we’ll get a read on the private employment sector through ADP’s monthly employment survey number. ADP is a private payroll services company with access to more than 600K business around the world, so they can get a pretty good read on the private jobs sector and a leading indicator to Friday’s Non-farm payroll number from the BLS.  The forecast is for a net addition of 225K jobs vs. 212K previous, and if we do see a better-than-previous read, it may mean we’ll see a better-than-forecast NFP number as well. Don’t expect an NFP level reaction, but if it is a big surprise we could see some movement in the Greenback.

To close out U.S. data, we’ll get the manufacturing PMI number (55.3 forecast/previous) at 1:45 pm GMT, and then construction spending (-0.1% forecast vs. -1.1% previous) and the ISM manufacturing index at 2:00 pm GMT (52.5 forecast vs. 52.9 previous). The ISM manufacturing number is the likely market mover within this group, and if today’s global PMI data is any clue, it just might break the recent trend of weaker-than-expected, declining reads.

See also:

Asia Session Recap

U.S. Session Recap

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