INVESTING: British Pound May Fall As PMI Data Undercuts BOE Rate Hike Bets
The final set of June’s UK PMI data figures headlines the economic calendar in European trading hours. The composite index is expected to show the pace of manufacturing- and service-sector activity growth rebounding after sliding to a five-month low in May. UK news-flow has tended to underperform relative to consensus forecasts recently, opening the door for a downside surprise. Such an outcome may push back BOE rate hike expectations, weighing on the British Pound.
The Australian Dollar underperformed in overnight trade, falling as much as 0.9 percent on average against its top counterparts. The decline followed a disappointing Retail Sales report. Receipts grew 0.3 percent in May, falling short of forecasts calling for a 0.5 percent increase. April’s reading was also revised downward to reveal a 0.1 percent contraction. The Aussie’s drop tracked a slide in front-end bond yields, suggesting soft news-flow inspired RBA rate cut speculation.
