Official data published this morning confirmed that China’s manufacturing sector continued to shrink for the sixth consecutive month - slipping to a 3-year low. Meanwhile, Caixin data, which focuses on smaller firms, exposed that activity in the manufacturing sector contracted for an 11th consecutive month. Poor Chinese data coupled with a loss in confidence regarding an intervention from OPEC caused oil prices to tumble this morning, currently trading 2% lower, while boosting USDCAD to session highs near 1.4030. Meanwhile, the Pound remains under pressure in the medium-term as recent polls suggest voters remain mainly undecided over UK’s EU membership and the possibility of a referendum occurring sooner rather than later. Today’s economic calendar begins with the UK publishing manufacturing data, which is forecasted to remain relatively unchanged month-over-month, followed by US inflation data in the form of the PCE Price index. Additionally, manufacturing data out of the US is projected to remain in contraction territory for the third consecutive month. ECB President Draghi is scheduled to speak this evening in front of the European Parliament with a Q&A session expected. His speech is anticipated to focus on monetary policy, while maintaining the usual dovish tone. Lastly, the RBA is widely expected to hold interest rates unchanged at tomorrow’s meeting, while repeating that the AUD remains overvalued. |
