On Wednesday, the sterling went further down as pressure rose due to the latest UK data release. According to officials, the UK Construction PMI (Purchasing Managers’ Index) came in at 54.2 for the month of February and for the January’s the value was revised at 55.0. The reading missed the expected 55.5 by more than 1 unit and sent the GBP/USD in the 1.3930 area. However, the GBP/USD cross managed to recover by the end of the session and even set new week highs, reaching close to the 1.4200 resistance ahead of NFP.
In the United States, the latest ADP Inc. (Automatic Data Processing Incorporated) release shows an acceleration in the private sector job growth for the month of February, building possible cause for a Fed rate hike later this year.
The report shows a 214K hike in private sector jobs in February, from which 190K jobs were added by private employees – previously, January scored a little higher for the private employees sector, marking a 193K plus. Dividing the 214K figure, we can see that 208K jobs come from the service sector and 5K jobs were added in the good production sector. The Non-farm payroll report will remain to be seen on Friday, the expectation being of a lack of change in the jobless rate at 4.9%.
On Thursday, the EUR/USD remained firm on its trend, with the EUR surrounded by bidding tone on behalf of the latest Service PMI for Germany and the Eurozone. The data came out better than expected for the preliminary result of February. Also, the EMU (European Monetary Union) Retail Sales surpassed expectations in the month of January, with a 0.4% expansion on a monthly basis and a 2.0% expansion on a yearly basis. The major marked fresh highs for the day, testing the 1.0970 area. On the US side, the Markit Service PMI and Factory Orders came in below expectations, while ISM’s (Institute of Supply Management) Non-manufacturing Index surpassed forecasts in the month of February by falling to 53.4 from January’s 53.5 (53.2 forecasted for February).
Oil prices went up yesterday, with the WTI (west Texas Intermediate) barrel hiking towards 8-week highs at $35.30 per barrel, but closed the session with almost no gains. The bullish sentiment in the crude market was tamed by the US stockpiles release, which showed an increase in oil inventories for the last week. In technical terms, if we look at the chart we can see that the price has entered into the resistance area, with yesterday’s rally halting the price just a few cents under the 100 DMA (Daily Moving Average) currently set at $35.60.