- UK Prime Minister’s speech awaited
- Sterling awaits service sector Purchasing Managers’ Index
- Australian building approvals slump
By David Johnson
The UK Prime Minister will give one of the most important speeches of her political career today when she addresses the Tory Party Conference. This follows yesterday’s speech by her arch nemesis, Boris Johnson, who gave a speech which poured scorn on Theresa May’s Chequers Brexit plan, but urged party members to get behind her. Quite what he plans to do when they are all behind her is another matter. Sterling largely ignored the politicking, but may be affected by this afternoon’s Prime Minister’s speech. The Pound will also be affected by the Service Sector Purchasing Managers’ Index (PMI) which is due this morning. The forecasts are for a small dip in this index, but that was also the case for the construction sector one we saw yesterday and the actual result for that was pretty poor.
Australian Dollar dilemma continues
Overnight, we saw a sharp drop in Australian building approvals. A 9.4% drop on the month is far worse than expected; the markets had forecast a small scale improvement. It points to one of the Reserve Bank of Australia’s dilemmas. They have positive economic data in many areas, but the housing market is still not growing. The Australian Dollar weakened a little on the news, after a very positive day on Tuesday.
Euro could use a helping hand today
This morning brings Eurozone retail sales data. That is expected to show a recovery of circa 0.2% after a similarly sized contraction last month. The Euro could do with some support as the Italian budget debate rages on.
US Dollar climbing back up
This afternoon brings a little bit of US data. The US Service Sector PMI and a composite one of all sectors are due, plus crude oil inventories and three speeches from Federal Reserve members. The US Dollar is having a bit of a resurgence after the US Mexico Canada trade deal, so any opportunity to take profit on that USD strength will be seized upon by traders. Yesterday’s speech by the US president which attacked Jean Claud Juncker was interesting. Not content with battling China, the US is seeking to do battle with the EU over trade. Join the club, Mr President…