The US dominates the week ahead with key data

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waterman
Written by Dan Waterman
November 25th, 2024
USD weakens after President Trump's personnel choice for Treasury Secretary..



GBP
The Pound managed to recover some lost ground against the Euro last week, but saw further losses versus the US Dollar. The gain against the single currency was all Euro-Zone based, but the decline versus the Dollar was due PMI divergence. 

All the PMI's for the UK were down this month, but more importantly all were in contraction. As a services nation, the services PMI is by far the most crucial number to look out for and instead of seeing the expected same reading as last month (52) we got a concerning 50 (anything above is expansion).  

This was a 13-month low with manufacturing coming out at a 9-month low. This was the first survey on the health of the UK economy after the Budget. The loss of confidence is now apparent and we expect sentiment to weigh on the Pound in the months to come. 

There is nothing due from the UK of note this week, but expect to see market volatility with it being the month-end and plenty going on elsewhere..




EUR
The Euro-Zone fared worse than the UK in terms of the PMI's released last week, but there wasn't much change in the exchange rate because the UK's were the more surprising. Once again then, France & Germany were the main drags on the Euro-Zone with the periphery nations faring 'ok' overall. 

Services PMI fell to a 10-month low with manufacturing struggling further into contraction. Germany looks to be in stagflation and a recession again is highly likely (but not a technical one this time) with the added bonus of Government uncertainty (along with France). 

More from France & Germany later in the week and if I was a betting man, I would expect further poor results which could hurt the Euro..



USD
The USD has for the first time in a very long time it feels started on the back-foot this week after an announcement by Donald Trump. The incoming President has nominated Scott Bessent as his Treasury Secretary, meaning an experienced Wall Street veteran has secured the role.

Bessent is a well-known and successful hedge fund manager who many deem represents the 'status-quo' in the US. A 'shake-up' was expected for the role to deliver new tariffs, but the safe card has been played which has satisfied global traders and investors.

Last week, the US produced some mighty PMI results going against the grain. Services PMI soared to the highest since March 2022 and jumped to 57 from 55.2. Extremely positive sentiments were delivered across all readings which further strengthened the $ on release.



Expected mid-market ranges for November 25th 2024

gbp
GBP
usd
USD

    $1.2500 - $1.2600    


gbp
GBP
eur
EUR

    €1.1950 - €1.2025    

Upcoming Data
Monday 25th November 2024
n/a



Tuesday 26th November 2024
08:00 UK - BoE MPC member Pill speech
13:00 US - Building permits
14:00 US - House price index
15:00 US - New home sales
19:00 US - FOMC meeting



Wednesday 27th November 2024
13:30 US - Initial/continuing jobless claims, durable goods, GDP, trade balance, personal income/spending, retail/wholesale inventories
15:00 US - Core inflation & inflation rate, pending home sales



Thursday 28th November 2024
08:00 EU - Spanish inflation 
10:00 EU - Euro-Zone consumer confidence
13:00 US - German inflation




Friday 29th November 2024
07:00 UK - BoE financial stability report
07:00 EU - German retail sales
07:45 EU - French GDP, inflation & consumer spending
08:55 EU - German unemployment
09:30 UK - Mortgage approvals & lending
10:00 EU - Euro-Zone core inflation & inflation rate




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