NewsCase StudiesEvents

AFEX Market Watch 1st August 2016

Also in the news...

Trade with the UK as a business based in the EU

If you run an EU-based business, check what your business needs to know to continue trading with the UK.

Safety and security requirements on imports and exports

Find out about new safety and security declarations that will apply from 1 October 2021 on goods leaving Great Britain (England, Scotland and Wales).

How to open a company in the USA while maintaining residence in Italy

It is one of the best ways for the Italian citizen to manage their business. This corporate vehicle allows access to multiple advantages of an advanced jurisdiction such as the US and also manages to maintain a low tax rate with very manageable levels of accounting and bureaucracy.

UK-ASEAN Joint declaration

Joint Ministerial Declaration on Future Economic Cooperation between the Association of Southeast Asian Nations (ASEAN) and the United Kingdom of Great Britain and Northern Ireland (UK).


These are exciting times for Dubai and the UAE. With the entire business world’s attention soon to turn to the Emirates with the delayed Expo 2020 kicking off in October (and continuing all the way through to the end of March next year) it’s never been a better time to be a UAE business owner

AFEX Market Watch 1st August 2016

Back to News

AFEX Market Watch

Monday Aug 1

· All day Swiss bank holiday

· All day Canadian holiday

· 09:30 GBP Manufacturing PMI

· 15:00 USD ISM Manufacturing PMI


Tuesday Aug 2

· 02:30 AUD Building approvals & Trade balance MoM

· 04:00 NZD Inflation expectations QoQ

· 05:30 AUD RBA rate statement and cash rate

· 09:30 GBP Construction PMI

· 14:15 NZD Dairy price index


Wednesday Aug 3

· 09:30 GBP Services PMI

· 13:15 USD ADP Non farm employment change

· 15:00 USD ISM Non manufacturing PMI

· 15:30 USD Crude oil inventories


Thursday Aug 4

· 00:30 AUD Retail sales MoM

· 12:00 GBP BoE Inflation report

· 12:00 GBP MPC rate decision

· 12:30 GBP BoE Governor Carney speaks

Friday Aug 5

· 02:30 AUD RBA Monetary policy statement

· 08:30 GBP Halifax HPI MoM

· 13:30 CAD Employment data and Trade balance

· 13:30 USD Non farm employment & Unemployment rate

· 13:30 USD Average hourly earnings MoM



Last week Sterling weakness was shown mainly on the crosses as the USD lost ground despite a mildly hawkish Fed. This meant GBPUSD managed to gain just over 1.5% on the week whilst it lost 1.5% to the EUR and 4% against the JPY. This week sees the release of more complete PMI data (remember that we had early PMI reads on July 22nd) with the main event of the week being the BoE meeting on Thursday. The market is heavily discounting a rate cut of 25 bps and also expects a restarting of the QE programme and possibly funding for lending. The BoE can change monetary policy however the Govt. also needs to change fiscal policy and build confidence in the economy. On this front the weekend press is full of stories about the building of the nuclear power station at Hinckley being put on hold as well as more procrastination on an additional airport runway for London, neither of these stories are helping to build confidence.



Last week saw EUR strength which was really a by-product of USD weakness. Firstly the market didn’t believe the Fed on Wednesday when it said that it was back in rate hike mode and on Friday when US GDP data came in at a weak +1.2% and lower than the expected +2.6% the EUR gained more ground. The European bank stress tests didn’t really provide many surprises but also didn’t include Portuguese or Greek banks so are having trouble being taken seriously. Event risk for the EUR will probably rise in October with the Italian referendum taking place and also comments from Turkey saying that if they don’t get visa free travel for their population by then they will allow the migrants currently being held in Turkey across their border and into Europe.



Month end selling of USD combined with poor economic data pushed the USD lower last week and the market will now look to economic data releases for direction on the US economy. Today we have ISM Manufacturing PMI and Wednesday we have ADP Non farm employment change which is a precursor to Friday’s official release of Non farm payrolls. Overnight Fed Governor Dudley (one of the three Fed members worth taking note of) urged caution on US rate hikes and said that a flatter tightening path for US rates was appropriate.

Commonwealth et al

Weak at the start of last week and then stronger at the end the AUD now waits for Tuesday’s RBA meeting for AUD direction. The market is pricing in a 50% chance of a rate cut by the RBA and with the Fed possibly not hiking rates until the end of the year the RBA could see this month as the right time to ease. Chinese data over the weekend was slightly better than expected although still very close to expectations. The CAD made ground last week against the USD despite a lower oil price.


  • AFEX is a trusted global payment and risk management solutions specialist.
  • Free Business & Private Accounts (No obligation to trade, cancel anytime with no fee)
  • Free Risk Management Consultation to assess your current FX rates & risk exposure
  • 24/7 Access to our market leading online payment platform – AFEXDirect
  • Currency MasterCard (14 currencies, free of any mark up, spread or commission)
  • Dedicated Account Management team to provide up to date market information
  • Preferential exchange rates on over 85 currencies
  • Operating since 1979
  • FCA Authorised and Regulated


You are not logged in!

Please login or register to ask our experts a question.

Login now or register.