Forex Weekly Round Up 1 September 2015 – 4 September 2015
German retail sales beat expectations, gaining 3.3% year-on-year despite eurozone confidence being shaken by the Greek debt crisis. Economists were forecasting a growth of just 1.7% so Germany’s bullish sales figures come close to doubling expectations.
Unemployment in the Eurozone fell to its lowest rate in July for more than three years. European Union statistics agency Eurostat said the jobless rate in the currency union fell to 10.9% in July from 11.1% the month before.
A two-year spell of jobs growth across British factories came to an end last month as manufacturing activity expanded at a slower pace, suggesting the sector is unlikely to boost economic growth during this quarter. The UK Manufacturing Purchasing Managers’ Index (PMI) fell in August to 51.5 from 51.9 in July, confounding expectations for a rise to 52.0.
The Markit construction Purchasing Managers’ Index (PMI) rose to 57.3 in August from 57.1 in July, indicating solid growth but below the 57.5 forecast. The survey published on Wednesday showed construction firms were bullish about the future, with most firms expecting to be busier over the coming year, while only one in 20 expected a contraction. On the back of this Sterling lost ground against both the EUR and USD.
The ECB kept policy rates unchanged at 0.05% but opened the door to more stimuli in shape of an extension to the Quantitative Easing package. QE is a tool used by the ECB to keep Euro Area interest rates artificially low by increasing the money supply to purchase government debt.
The US Fed’s Beige Book released last night said the economy continued to grow throughout most of the country during July and August, stating the solid rebound in economic growth in the second quarter continued into the summer but at a more moderate pace.
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