INTERNATIONAL CURRENCY BUZZ
- Forex – Aussie and kiwi move higher, RBA holds rates.
- Forex – Dollar little changed in rangebound trade.
- Forex – USD/CAD pares losses as oil prices turn lower.
Service sector activity in the U.S. grew for the 79th consecutive month in August, but at a slower pace than expected, industry data showed on Tuesday.n a report, the Institute of Supply Management (ISM) said its non-manufacturing purchasing manager’s index (PMI) fell to 51.4 last month from 55.5 in July. Analysts had expected the index to drop to 55.0.On the index, a reading above 50.0 indicates the non manufacturing sector economy is generally expanding, below 50.0 indicates the sector is contracting.In an immediate reaction, the dollar weakened. EUR/USD was trading at 1.1213 from around 1.1159 ahead of the release of the data, GBP/USD was at 1.3404 from 1.3367 earlier, while USD/JPY was at 102.48 from 103.35 earlier.The US dollar index, which tracks the greenback against a basket of six major rivals, traded at 95.17 compared to 95.62 prior to the release.
The pound rose to a one-month high against the U.S. dollar on Monday, boosted by data showing that activity in the U.K. service sector returned to expansionary territory in August, while the greenback remained broadly under pressure.GBP/USD 1.3367 during European morning trade, the pair’s highest since August 3; the pair subsequently consolidated at 1.3367, climbing 0.54%.Cable was likely to find support at 1.3123, the low from September 1 and resistance at 1.3480, the high of July 14.Research group Markit said its U.K. services purchasing managers’ index rose to 52.9 last month from a reading of 47.4 in July. Analysts had expected the index to rise to 50.0.The upbeat data added to current optimism over the strength of the economy and Britain’s ability to overcome any post-Brexit hurdles.
- BUY GBP/USD ABOVE 1.3445 TGT 1.3465 1.3495 SL 1.3415.
- SELL GBP/USD BELOW 1.3280 TGT 1.3260 1.3230 SL 1.3310.