UK Pound and Euro Weaken Against the US Dollar

The US Dollar has climbed upwards on both the UK pound and the euro, throughout yesterday and this morning.

Currently, GBP/USD rate is that sterling is buying $1.45, a mark that it has stayed around since the beginning of the day GMT.

This is a significant fall from yesterday morning GMT, where the pound was buying $1.47.

The pound is thought to have suffered from the less than encouraging manufacturing sector PMI results released by Markit yesterday, and the prospect of a ‘Brexit’ continues to shadow the fortunes of sterling.

The EUR/USD relationship has been similar to GBP/USD over the past 24 hours.

The euro now buying $1.14, from reaching just over $1.16 yesterday morning, the highest rate since August last year.

LMAX Exchange analysts in their daily round up, opined that the combination of a technically extended market, in addition to a renewed wave of risk off trade, oil weakness, and patchy liquidity have propelled dollar demand.

Hawkish comments from Dennis Lockhart and John Williams, the Federal Reserve chiefs from Atlanta and San Francisco respectively, where they were both supportive of a June rate hike, may also have factored into euro weakness.

Volume of Retail Trade Down by 0.5% in Euro Area

The latest Eurostat figures on the retail trade sector has shown that the volume of trade has been reduced by 0.5% in the euro area, and 0.7% in the European Union (EU).

The figures are disappointing when compared to February, where activity in the retail industry in the euro area increased by 0.3%, and was stable in the EU.

In contrast to the same month a year ago, the calendar adjusted retail sales index increased by 2.1% and 2.4% in the euro area and EU respectively.

The main areas where trade has fallen in the sector month on month in the euro area , are in food, drinks and tobacco by 1.3%,  for non food products by 0.5% , and 0.4% in automotive fuel.

In the EU, food drinks and tobacco declined by the same volume, while non food products fell by 0.1% more, automotive fuel performed better falling by 0.1%.

Among Member States for which data are available, the largest decreases in total retail trade were found in Portugal on minus 5.2%, Denmark minus 3.9%, and Estonia  minus 1.8%.

While the highest increases were registered in Finland on plus 1.1%, Slovakia 0.9%, and Bulgaria 0.8%.

UK Construction Industry Falls to Three Year Low Says Markit Survey

The Construction industry in the UK has contracted in April,  revealed the latest PMI on the sector from financial research company Markit.

The latest survey reading for the construction industry was 52, above the no change mark of 50, but growth had eased from the 54.2 score that was recorded in March.

There have now been three years of sustained growth in the sector, but the April survey reading is the lowest expansion of business activity since mid 2013.

Commercial building was the most successful part of the sector for April, although this upturn was the slowest since July 2013.

Residential construction bounced back only slightly from a 38 month low in March.