PMI numbers from the UK and EU converged even closer in March, with EU numbers surprising to the upside and showing expansion, whilst UK numbers came in lower-than-expected. GBPEUR was marginally lower on the day. USD continued to sell off as initial jobless claims came in higher, as well as positioning themselves ahead of today's job numbers.
*Daily move - against G10 rates at 7:30am, 05.04.24
** Indicative rates - interbank rates at 7:30am, 05.04.24
Both GBPUSD and EURUSD have retraced 50% of the losses suffered since the 21st February, as recent disappointing data from the US caused some profit taking on recent gains for USD. So all eyes open today at 1.30pm for the job numbers and what this means for June rate cut odds – currently 65%. Strong job numbers will add to the argument of a strong US economy, and will likely discount the odds of a rate cut in June, which should see another test of the recent lows on GBPUSD and EURUSD. A soft number will like add to upside gains on the pairs.
So all eyes on today's job numbers and the key takeaway, as ever, will be if the numbers show that the US economy is proving to be resilient or not. Markets are expecting job additions to come in at 214,000, and an increase in hourly earnings to 0.3%.
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