?Aussie? Rising on Impending Trans Pacific Trade Agreement, Sterling Sinks with Slowing UK Services Sector

Pound Sterling
The prospects of the Pound have not picked up this week as Monday morning saw the release of the latest UK Services PMI, which proved to be a decided disappointment. As traders had been anticipating sector expansion, at 56, the actual result of 53.3 sparked fresh fears of domestic economic contraction and prompted a general downturn for the currency. With the service industry making up the single largest portion of the UK GDP this dovish data was not considered to bode well for the longer-term prospects of Sterling.

Euro
Economic confidence in the Eurozone took another blow this morning as the domestic Services and Composite PMIs for September underperformed. Germany and Spain in particular showed decided signs of slowing, in spite of French services edging further upwards away from the neutral growth baseline of 50. Nevertheless, this failed to particularly push down the Euro as the single currency remained strong as a result of Friday’s decline in US Dollar demand. Adding further support for the dominant common currency was the domestic August Retail Sales data, which showed a smaller slid than expected to clock in at 2.3%.

US Dollar
Following Friday’s uninspiring Change in Non-Farm Payrolls figure movement on the ‘Greenback’ has remained fairly muted, pundits still adjusting to the lowered odds of an imminent interest rate increase from the Federal Open Market Committee (FOMC). Only 142,000 new jobs were created in the domestic economy over the last month, a far lower number than the 201,000 that traders had been hoping for. Ahead of the afternoon’s Non-Manufacturing PMI the ‘Buck’ is on a downtrend against many of the majors, with forecasts predicting another indication of slowed economic growth.

Australian Dollar
Overnight the Australian Service PMI showed a decided decrease on the month, slipping from 55.6 to 52.3. However, as risk sentiment appears to be on the rise again following last week’s disappointing US employment figures, the ‘Aussie’ has been buoyed by the news of an impending agreement on the Trans Pacific Partnership, a significant trade agreement between a number of nation’s on the Pacific rim. Five years in the making, this free trade pact is expected to bring a decided economic boost for the various partner nations, good news for the volatile antipodean currency.

New Zealand Dollar
As New Zealand is also involved in the Trans Pacific Partnership talks the ‘Kiwi’ has been on a substantial uptrend against rivals today. With a prospect of greater market access for the domestic dairy trade this has helped to shore up the South Pacific currency, somewhat quelling recent fears over the future of the nation’s major export.

Canadian Dollar
The ‘Loonie’ has been buoyed against many of the majors after news emerged that Russia is willing to enter talks with other oil-producing nations regarding the current crisis faced by the commodity market. Suggesting the potential for a slowing of production in one of the world’s main exporters this saw benchmark Brent crude climbing back towards $49 per barrel.