Europe

The Euro recovered some ground after upbeat German and Euro-zone July Manufacturing, Services and Composite PMIs. Data from the bloc’s largest economy showed that business activity expanded in July as the services sector grew at the fastest rate in 3 years with e PMI jumping to 56.6. Data for the wide Euro-zone showed that the manufacturing index rose to 51.9, above the expected 51.7 reading while services’ climbed to 54.4 well above the forecasted 52.7. The 18-nation currency was up 0.1% to $1.3474 after touching a fresh 8-month low of $1.3443. Against its Japanese peer, it edged up from its lowest level since Nov.21 of 136.4109 Yen hit earlier today, last standing at 136.8342 Yen, down 0.1% from yesterday’s close.

Sterling dropped after retail sales data came in below economist forecasts. The report from the National Statistics showed that retail sales increased by just 0.1% in June less than the 0.3% expected while on a yearly basis it increased by 3.6%. Despite the data coming in below forecast, UK retail sales volumes in the second quarter were at the strongest level seen in 10 years but traders interpreted the numbers as soft which pushed down the currency. The Pound immediately fell to a 4-week low of $1.7008 after the release of the figures. It last bought $1.7011, down 0.2% from late U.S trades. It slid 0.2% to 1.2628 Euro and was slightly down at 172.9135 Yen. The Pound may found support on the next major event on the economic calendar, the second quarter UK GDP report to be released tomorrow.

North America

The U.S Dollar slightly lower ahead of the latest continuing and initial jobless claims data. Also due later in the day are the release of the manufacturing PMI which is widely expected to show an improvement from the previous month and the new home sales readings which could also give a boost to the currency. The Greenback traded little changed at 101.5463 Yen. It fell 0.1% to $1.3474 per Euro after reaching a fresh 8-month high of $1.3443 per Euro earlier today.

Around the world

The Yen lowered amid a boost in risk appetite following the release of upbeat Chinese flash PMI. Data from the world’s most populous country showed that the manufacturing PMI rose to a 18-month high at 52.0. The currency was also weighed down on news of a surprise dip in Japanese trade data which came days after the government cut its fiscal year growth forecasts. The Yen fell 0.1% to 136.8342 per Euro after appreciating to an 8-month high of 136.4109 per Euro. It traded little changed at 101.5463 per Dollar

Australia’s Dollar strengthened after an upbeat manufacturing read from China, the South Pacific nation’s biggest trading partner. The so-called Aussie has been appreciating since yesterday after encouraging inflation data. Today, it touched a 3-week high of $0.9467 versus the U.S currency after the Markit Economics reported that China’s manufacturing sector expanded with the PMI rising above expectation to 52 points in July. It last traded at $0.9444, little moved from yesterday’s close. Against the single currency, it surged above the 70.30 cents level for the first time since Nov.07 before standing at 70.04 cents, down 0.2% from late U.S hours. The Aussie climbed to its highest since July 02 at 96.1484 Yen before fetching 95.9165 Yen, almost unmoved from yesterday’s close.

The New Zealand Dollar dropped to a six-week low after Reserve Bank governor Graeme Wheeler said that the currency’s high level was “unjustified.” The Kiwi was also weighed down as the central bank signalled that it will pause its rate hikes after increasing the official cash rate to 3.5% today amid benign inflation and a strong currency. It dropped 0.4% to $0.8589, having plunged to $0.8571, the least since June 10. It fell 0.5% to 63.77 Euro cents, hovering near its newly hit 6-week trough of 63.60 cents. Against its Japanese peer, the Kiwi fell as low as 86.9490 Yen, unseen since June 04, before trading at 87.2766 Yen, 0.3% below late U.S close.

Interbank Rates

GBP/EUR    1.26272
GBP/USD    1.70148
GBP/JPY    172.915
EUR/USD    1.34747
EUR/JPY    136.939
USD/AUD    1.05892
USD/CAD    1.07245
USD/NZD    1.16380
USD/JPY    101.626