The Pound exchange rate has been in a tight range with the US Dollar (GBP/USD) and Canadian Dollar (GBP/CAD) so far on Wednesday, while jumping higher against the Turkish Lira (GBP/TRY) as markets await a busy day of data.
UK Manufacturing Forecast to Fall – Pound Tentative
The biggest ecostat for the Pound today is likely to be the UK Manufacturing Purchasing Managers’ Index (PMI) which is forecast to soften from 54.4 to 54.2 in July. However, if an upswing takes place or the number remains the same, Sterling might be offered some stability.
Meanwhile, in Canada, investors are also awaiting the latest Canadian Manufacturing PMI. The July reading is forecast to increase from 57.1 to 57.5 and could bode well for the Canadian currency if it does. There are no other highly influential Canadian ecostats out in the rest of the week, meaning the CAD exchange rate could be influenced by oil prices and political tensions, including NAFTA developments.
US ADP Employment and Fed Rate Decision could Impact the USD Exchange Rate
In the US, markets are gearing up for a very influential day. Firstly, high-tier ISM Manufacturing and ISM Employment stats will be released this afternoon, and economists currently expect the manufacturing index to fall from 60.2 to 59.3. A bigger fall could put the US Dollar exchange rate on shaky ground. Additionally, the ADP Employment Change figure will also reach markets and is usually seen as a precursor to Friday’s highly influential Change in Non-Farm Payrolls stat. Markets predict the July figure will come in at 185K after the previous month’s 177K.
However, investors will also be looking towards the Federal Reserve’s latest interest rate decision later today. Markets expect interest rates to remain on hold today, but an unlikely surprise move could create quick USD movements.
In Turkey, the latest Istanbul Chamber of Industry Manufacturing PMI rose from 46.8 to 49.0. However, despite a rise, the figure remains below the 50.0 benchmark which separates expansion from contraction and the Turkish Lira to Pound Sterling (TRY/GBP) exchange rate softened in response. Friday could be an interesting day for the Lira when the latest Turkish inflation rate stats reach markets.
The Pound to Turkish Lira exchange rate is trading at 6.4618. The Pound to Canadian Dollar (GBP/CAD) exchange rate is trending at levels of 1.7070. The Pound Sterling to US Dollar (GBP/USD) exchange rate is trading at 1.3112.