After the major currency pairs including the euro and pound closed at multi-month high levels on Friday, not much movement has been seen up till now on Monday as they are moving at that same level. However, the fundamentals that have been released up till now in the European session show that the manufacturing sector in the Spanish economy has contracted to a shocking level and that too unexpectedly.
Moreover, the economic indicators released in the Asian session included the building approvals of the Australian economy that came out to be better than expected, still the outcome was not positive as the building approvals contracted with a lesser than expected rate. This shows that the housing sector is still in recession in the Australian economy; however, the company operating profits of Australia showed 3.9% growth in the past month against the expected figure of 1.1%.
The upcoming fundamentals that investors are looking forward to this week include the manufacturing PMI of the U.K. economy, construction PMI and most importantly the services PMI. The first week of every month is always critical for the British Pound as these 3 key indicators determine the overall outlook of the pair. Moreover, the interest rate data is also set to be released on Thursday where we need to see whether it is increased from 0.5 to 0.75% or not, if it does then Pound might be looking forward to test 1.6712 area in short to medium term.
Other fundamentals include the ISM Manufacturing PMI of the U.S, and non-farm employment change, new home sales data, unemployment claims, the prelim GDP quarterly, and the biggest event of the month i.e. non-farm payrolls data that is set to be released on Friday along with the unemployment rate.
Investors might be looking forward to go along with bears this week as the retracement is due for the bullish move that has happened for the past 2 weeks; plus, such critical fundamentals which may come out to be unfavorable for the major pairs can drag them down badly.
To contact the reporter of this story: Jonathan Millet at firstname.lastname@example.org