Currency news

Markets simmering ahead of US job numbers

Head of FX Analysis at Equals Money
-
3
min read
Publish date
05/06/24
  • US job openings fall to the lowest since Feb 21
  • US services and Bank of Canada in focus today


Yesterday's currency recap

US job openings fell more than expected in April, continuing to indicate a gradual slowdown in the US job market. USD weakness was minimal however going into Friday's job numbers, and perhaps markets are waiting for that number before weakening USD further.

We had the first TV debate between PM Sunak and Starmer last night. A snap YouGov poll gave Sunak the slight edge, with the PM coming out on top on tax and on immigration. However, Starmer led in likeability, the NHS and education. No impact on GBP.

Today's GBP rates

Currency pair Daily move* Indicative rate**
GBPAUD 0.55% 1.9253
GBPCAD 0.28% 1.7505
GBPCHF -0.83% 1.1377
GBPDKK 0.05% 8.7662
GBPEUR 0.05% 1.1753
GBPJPY -0.97% 197.9510
GBPNOK 1.00% 13.5299
GBPNZD 0.14% 2.0712
GBPSEK 0.23% 13.3611
GBPUSD -0.16% 1.2790


*Daily move - against G10 rates at 7:30am, 05.06.24

** Indicative rates - interbank rates at 7:30am, 05.06.24

Key data points

Currency Event Period Consensus Previous
EUR Services PMI May 53.30 53.30
EUR Composite PMI May 52.30 52.30
EUR PPI MoM Apr -0.70% -0.40%
EUR PPI YoY Apr -5.30% -7.80%
GBP Services PMI May 52.90 52.90
GBP Composite PMI May 52.80 52.80
USD Services PMI May 54.80 54.80
USD Composite PMI May 54.20 54.20
USD ISM Services May 51.00 49.40
USD ADP Employment Change May 175,000 192,000
CAD BoC Rate Decision June 4.75% 5.00%

Upcoming speeches

  • None today.

What we think

Quite a bit of data today, with the main market focus set to be the ADP payroll report, ISM services, and the Bank of Canada rate decision. The ADP payroll print may not have much of an impact if yesterday's reaction to the JOLTs report is anything to go by, so we look to the ISM services print at 3pm to give another gauge of how the US economy fared in May.

The Bank of Canada is widely expected to cut rates from 5% to 4.75% (83% chance), but more importantly seems unlikely to commit to another rate cut, possibly electing to be data dependent. GBPCAD is currently trading at the highest levels since September 2021.

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About the author
Thanim Islam
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Head of FX Analysis at Equals Money

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