The U.S. dollar posted strong gains on Tuesday since the start of the European trading session. The USD jumped on the strong manufacturing PMI report. Data from the Eurozone was quiet.
The British pound continued to weaken as construction activity as measured by the PMI fell to 52.9. This was below forecasts and was the first decline after three consecutive months of gains.
The NY trading session showed that the ISM’s manufacturing PMI gauge rose strongly to 61.3 in August. This beat estimates of a 57.6 forecast and a strong rebound from July’s 58.1.
Construction spending data was however slightly weaker as activity increased just 0.1% on the month which was below forecasts.
Earlier today, the quarterly GDP report from Australia showed that the economy advanced 0.9% on the second quarter. This was higher than the forecasts of a 0.7% increase. The first quarter GDP data was also revised higher to show a 1.1% increase.
The European trading session will be dominated by the services PMI reports from the Eurozone including Spain, Italy, Germany, and France. The composite services PMI for the Eurozone is expected to remain steady at 54.4, unchanged from the month before.
In the UK, services PMI is forecast to rise modestly to 53.9. This comes following July’s headline print of 53.5.
The NY trading session will see the Canadian trade balance figures coming out. Later in the day, the Bank of Canada will be holding its monetary policy meeting. No changes are expected to the overnight cash rate which is expected to stay put at 1.50%.
