Currency traders are bracing themselves for the latest US nonfarm payrolls report scheduled later in the day amid ongoing uncertainty about whether the FOMC will raise its benchmark interest rate at its upcoming monetary policy meeting. Today’s US employment report will be particularly eyed considering the conflicting cues from policymakers about a rate rise at the September meeting of the Fed.In Europe, the ECB downgraded its growth and inflation forecasts which led the common currency to weaken against a basket of currencies yesterday. In today’s economic news, German factory orders fell more than expected in July, sparking concerns about easing of growth in the Euro zone’s largest economy. In the UK, the domestic economic calendar is light today.
The just out survey report revealed that growth in Britain’s services sector which accounts for the largest proportion of the nation’s GDP moderated for the second straight month in August, primarily as a result of the slowest increase in new businesses since April 2013.In Europe, the final services PMI numbers from the Euro zone and most of its economies came above expectations for August. Later in the day, the ECB will meet to discuss its interest rate policy amid recent speculation that the bank is looking to expand its current QE programme. Across the Atlantic, jobless claims, trade data and reports on the nation’s service industry will be released today.
The PMI data released just now indicated that activity in Britain’s construction industry expanded, albeit at a slower than expected pace for August, lifted by a sustained recovery in residential building activity. Going forward, investor focus will drift towards the nation’s dominant services sector, with the services PMI report scheduled for release tomorrow.Across the Atlantic, the ADP employment report due later today will provide an early look at hiring trends in the US labour market ahead of the key nonfarm payrolls print on Friday. Also, US factory orders data will draw some market attention. In Europe, today’s producer prices update will provide signs whether deflation risk is on the rise in the Euro region.