By: xemarketanalysis
OVERVIEW
The service sector PMI in Europe disappoints as activity tails off as we approach the end of the second quarter
Sterling rallies helped by interest rate expectations that UK interest rates may go higher sooner rather than later
Bank of Mexico raises interest rates to 7%
The US dollar sidelines while market waits for inflation data next week
Canadian inflation data disappointed by growing by just 0.1% in May and 1.3% y/y forcing the Canadian dollar to drop 0.5% in value
HIGHLIGHT
One year on from Brexit, Theresa May has offered that no EU citizen living lawfully in Britain will need to leave and those that have lived in Britain for five years will have 'settled status' and will be eligible to health care, pensions, benefits and education just like a British national.
US DOLLAR
The US Dollar has weakened a little as we await further clues for the outlook on interest rates with next week's inflation data being key.
BRITISH POUND
The Pound has rallied over the last 24 hours as talk of the potential for interest rate hikes start to heat up while Theresa May initial discussions on Brexit meet with a relatively warm reception from the EU leaders
EURO
The service sector PMI data dropped to 54.7 in June from a previous reading of 56.3 in May, which was a surprise to the market which was expecting a steady continuation in the pick-up in activity.
CANADIAN DOLLAR
The Loonie weakened by 0.5% as inflation fell short of expectations of growth of 0.2% in May and only rose 1.3% y/y.
AUSTRALIAN DOLLAR
The Australian dollar ends the week higher but held back from making further gains on talk of a second Australian state looking to charge its own bank tax.
FEATURED CURRENCY
The Central Bank of Mexico raised interest rates by 25bps to 7% in line with expectations and this is now expected to be the final hike in the recent cycle.
Read more
