Daily Insight

In the past 24hrs we have seen some significant market movement particularly with regards the Dollar as ISM Manufacturing, which many analysts were predicting would expand in March, came out at a much slower pace in the first quarter, due in part to rising prices and a fall in new orders. As a result, the Dollar fell roughly two points to open this morning above the 1.7400 level and without any significant data released in the UK or the States today, we can look towards the end of the week and Nonfarm Payrolls in the U.S as an indication of whether Sterling can capitalise further on relative Dollar weakness.

With regards the Euro, we continued to test the major support level at 1.4300 yesterday after PMI Manufacturing data in the Euro-zone expanded to its fastest pace in almost 5 years last month, fuelling speculation that the ECB will raise interest rates in order to counter inflation as economic growth begins to accelerate. The monthly index showed a rise to 56.1, the highest level since September 2000, from 54.5 in February.

There is some important data released today that is likely to affect the Euro with Producer Price Index for February set to show a 0.5% rise last month and we will be paying particular attention to the Unemployment rate, which is expected to be unchanged from January at 8.3%.

Data Released 4th April

EUR 10:00 Producer Price Index (Feb)

EUR 10:00 Unemployment Rate (Feb)

written by Adam Solomon