UK Manufacturing Growth Fastest In 10 Months

Trading 21 fév 2020 Commentaire »

UK manufacturing grew at the fastest pace in 10 months in February, while the services sector expanded at the slowest pace in two months, leading to stable growth of the private sector survey data showed Friday. The flash IHS Markit / CIPS Flash UK Composite Purchasing Managers' Index showed a reading of 53.3 in February, unchanged from January. A reading above 50 suggests expansion in the sector.

The latest reading pointed to the joint-fastest expansion of private sector output since September 2018, IHS Markit said. The flash services PMI fell to a two-month low of 53.3 from January's 53.9. In contrast, the flash manufacturing PMI hit a 10-month high of 51.9 versus 50.0 in January. Though receding political uncertainty boosted business as well as consumer confidence, the overall rate of new order growth eased from the 19-month peak seen in January amid the weakness in the services sector.

Several service providers reported that the coronavirus, or Covid-19, outbreak had weighed on overseas bookings and resulted in the cancellation of some orders from clients in Asia, particularly those based in mainland China, IHS Markit said. In manufacturing, extended shutdowns in China led to stocks of inputs falling at the fastest pace for over seven years and vendor lead times lengthening to the greatest extent since March 2019.

The supplier delivery times sub-index dropped seven points signalled the largest month-on-month slide in supply chain performance since the survey began in 1992 and exceeded the previous record seen during the UK fuel protests in September 2000, the survey found. Despite the coronaviurs concerns, output growth expectations across the UK private sector improved slightly since January and remained the highest since June 2015.Service providers were more optimistic than manufacturers. "The recent return to growth signaled by the manufacturing and services PMIs provides a clear indication that the UK economy is no longer flat on its back, with our GDP nowcast pointing to 0.2 percent growth through the first quarter of the year," IHS Markit Associate Director Tim Moore said.


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U.S. Existing Home Sales Pull Back Less Than Expected In January

Trading 21 fév 2020 Commentaire »

Existing home sales in the U.S. pulled back in January after jumping in December, according to a report released by the National Association of Realtors on Friday, with existing home sales continuing a fluctuating pattern of monthly increases and declines.

NAR said existing home sales slumped by 1.3 percent to an annual rate of 5.46 million in January after surging up by 3.9 percent to a revised rate of 5.53 million in December. Economists had expected existing home sales to tumble by 1.8 percent.

Despite the monthly decrease, the report noted existing home sales in January were up by 9.6 percent compared to the same month a year ago.

"Existing-home sales are off to a strong start at 5.46 million," NAR's chief economist Lawrence Yun. "The trend line for housing starts is increasing and showing steady improvement, which should ultimately lead to more home sales."

The pullback in existing home sales in January came as home sales in the West region plunged by 9.4 percent to a rate of 1.060 million.

On the other hand, existing home sales in the Midwest jumped by 2.4 percent to a rate of 1.290 million, while home sales in the South and Northeast were nearly unchanged.

NAR said the median existing home price for all housing types was $266,300 in January, down 3 percent from $274,500 in December but up 6.8 percent from $249,400 in the same month a year ago.

"Mortgage rates have helped with affordability, but it is supply conditions that are driving price growth," Yun said.

The report said housing inventory at the end of January totaled 1.42 million units, up 2.2 percent from December but down 10.7 percent from a year ago.

The unsold inventory represents 3.1 months of supply at the current sales pace, up from the 3.0-month figure recorded in December but down from the 3.8-month figure recorded in January 2019.

Single-family home sales tumbled by 2.6 percent to an annual rate of 4.85 million in January, while existing condominium and co-op sales slumped by 1.6 percent to a rate of 610,000.

Next Wednesday, the Commerce Department is scheduled to release a separate report on new home sales in the month of January.


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*U.S. Existing Home Sales Slump 1.3% In January

Trading 21 fév 2020 Commentaire »

U.S. Existing Home Sales Slump 1.3% In January


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Eurozone Private Sector Growth At 6-month High

Trading 21 fév 2020 Commentaire »

Euro area private sector grew for a third straight month and at the fastest pace in six months in February, mainly led by further expansion of the services sector, though there were signs of demand and production being hurt by the coronavirus outbreak in China.

Elsewhere on Friday, final data from Eurostat confirmed that Eurozone inflation accelerated for the third straight month in January. The flash composite purchasing managers' index, or PMI, climbed to 51.6 from 51.3 in January, preliminary survey data from IHS Markit showed on Friday. Economists had forecast a score of 51.

A PMI reading above 50 suggests growth in the sector. The latest reading was the best since August. The flash services PMI rose to a two-month high of 52.8 from 52.5 in January. Economists had expected a reading of 52.2. The flash manufacturing PMI rose to a 12-month high of 49.1 from 47.9 in January. Economists had forecast a weaker score of 47.5. The flash manufacturing PMI output index climbed to an eight-month high of 48.4 from 48 in January. "While the February survey data are welcome news in a month in which media headlines have been dominated by fears of economic growth being hit by the COVID-19 outbreak, the full immediate impact may not yet be apparent," IHS Markit Chief Business Economist Chris Williamson said. Eurostat data showed that inflation climbed to 1.4 percent from 1.3 percent in December. The rate was in line with the flash estimate. Core inflation that excludes prices of energy, food, alcohol and tobacco, eased to 1.1 percent in January from 1.3 percent in the previous month.

Nonetheless, headline inflation remained well below the European Central Bank's target of "below, but close to 2 percent."

The IHS Markit survey showed that new order growth remained subdued and the pace of expansion was unchanged from January's seven-month high. Despite the new business growth, backlogs continued to decline signalling persistent excess capacity. In the service sector, new business growth slowed slightly, partly due to the weakness in travel and tourism. The coronavirus outbreak partly hurt some areas of business. In manufacturing, new order growth fell for a seventeenth successive month, but the decline was the smallest in over a year as stronger demand from the domestic market offset a slump in export orders.

Manufacturing was constrained by a marked lengthening of supplier delivery times. Supply chain disruptions caused by the coronavirus outbreak were largely to blame for the delays that were the most widespread since December 2018.

Private sector employment continued to rise at a weaker pace due to subdued new business growth and sustained the softest spell of job creation seen for five years. Job growth in the services sector was the weakest in 13 months, while job losses in manufacturing hit a three-month low.

Average input price inflation slowed from January's eight-month high, while average selling prices rose at the joint slowest rate for over three years. Service sector costs and prices rose, but factory costs and charges continued to fall. Average prices charged for goods dropping at the fastest rate for almost four years.

Output growth expectations dropped from January's 16-month high, but remained well above the average of 2019. Business sentiment weakened in both services and manufacturing. In the biggest euro area economy, Germany, the private sector growth was largely unchanged in February with the flash composite PMI slightly easing to a two-month low of 51.1 from 51.2 in January. Economists had forecast a score of 50.8. The services PMI eased to a two-month low of 53.3 from January's 54.2. Economists had expected a score of 53.8. The flash manufacturing PMI hit a 13-month high of 47.8 from 45.3 in January. Economists had expected a score of 44.8. The manufacturing output index rose to a nine-month high of 47. In France, the flash composite PMI hit a two-month high of 51.9 versus 51.1 in January. Economists had expected a score of 51. The services PMI climbed to a four-month high of 52.6 from 51 in the previous month, topping economists' forecast of 51.3. The manufacturing PMI, however, fell to a seven-month low of 49.7 from 51.1 in January. Economists had expected a higher score of 50.7.


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Pound Spikes Up After Positive UK PMI Data

Trading 21 fév 2020 Commentaire »

The pound firmed against its major counterparts in the European session on Friday, after U.K. manufacturing sector activity accelerated to its highest level since April last year in February, easing some of the fears over the economy.

Survey results from IHS Markit and the Chartered Institute of Procurement & Supply showed that the manufacturing PMI rose to a 10-month high of 51.9 in February from 50.0 in January. Economists had forecast a score of 49.7.

The flash composite output index remained unchanged at 53.3 in February. The reading was above the forecast of 52.8.

The services Purchasing Managers' Index dropped to 53.3 in February from 53.9 in January. The reading was forecast to rise by 53.4.

Sentiment faded after a rapid rise in the number of coronavirus infections outside of China.

China's commerce ministry said January and February exports and imports will be hit by the epidemic that has severely disrupted the world's second-largest economy.

The pound strengthened to 2-day highs of 0.8343 against the euro and 1.2952 against the dollar, from its previous lows of 0.8381 and 1.2874, respectively. The pound is seen finding resistance around 0.82 against the euro and 1.31 against the dollar.

The pound appreciated to more than a 2-month high of 144.89 against the yen, after falling to 143.72 in early deals. Next likely resistance for the pound is found around the 147.00 level.

Data from the Ministry of Internal Affairs showed that Japan's inflation slowed in January after rising in the previous month.

The consumer price index increased 0.7 percent year-on-year in January, slower than 0.8 percent rise in the preceding month. This was in line with economists' expectation.

Erasing an early low of 1.2663 against the Swiss franc, the pound gained to 1.2714. Immediate resistance for the pound is seen around the 1.31 level.

Looking ahead, U.S. existing home sales for January are due in the New York session.


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*Canadian Retail Sales Were Virtually Unchanged In December

Trading 21 fév 2020 Commentaire »

Canadian Retail Sales Were Virtually Unchanged In December


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*Pound Climbs To 2-day High Of 1.2952 Against Dollar

Trading 21 fév 2020 Commentaire »

Pound Climbs To 2-day High Of 1.2952 Against Dollar


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*Pound Rises To 2-day High Of 0.8343 Against Euro

Trading 21 fév 2020 Commentaire »

Pound Rises To 2-day High Of 0.8343 Against Euro


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EUR/USD for February 21,2020 – Major upward target at the price of 1.0855 has been reached, still more room to the upside

Trading 21 fév 2020 Commentaire »

Technical analysis

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EUR/USD has been trading upwards, exactly what I predicted yesterday. EUR did reach our first upward target at the price of 1.0855 and its heading towards the second at 1.0887 and third at 1.0924. Main reason for this rally was breakout of the downward channel in combination with bullish divergence on MACD oscillator.

I would still watch for buying but on the dips. Watch for eventual bull flag pattern on hourly of 4H time-frame to confirm further upside continuation.

MACD oscillator is showing increased momentum on the upside.

Resistance levels are set at the price of 1.855, 1.0887 and 1.0924

Major support level is set at 1.0777

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Euro Advances As German Manufacturing PMI Rises To 13-month High

Trading 21 fév 2020 Commentaire »

The euro appreciated against its most major counterparts in the European session on Friday, as German manufacturing sector activity expanded more than expected in February to the highest since January 2019.

Flash survey results from IHS Markit showed that the manufacturing PMI climbed to a 13-month high of 47.8 from 45.3 in January. Economists had forecast a reading of 44.8.

The reading was well below the neutral 50.

The flash composite output index rose to 51.1 in February, compared to forecast of 50.8. The index registered a five-month high of 51.2 in January.

Nonetheless, the services Purchasing Managers' Index fell to 53.3 from 54.2 in January. The reading was forecast to rise to 53.9.

The euro climbed to 1.0820 against the greenback and held steady thereafter. The next likely resistance for the euro is seen around the 1.11 level.

The euro ticked up to 1.0622 against the franc immediately after the data. On the upside, resistance is likely seen near the 1.08 level.

The single currency bounced off to 120.90 against the yen, from a low of 120.36 seen at 3:00 am ET. The euro is likely to face resistance around the 122.00 region, if it gains again.

Data from the Ministry of Internal Affairs showed that Japan's inflation slowed in January after rising in the previous month.

The consumer price index increased 0.7 percent year-on-year in January, slower than 0.8 percent rise in the preceding month. This was in line with economists' expectation.

The euro rallied to a 3-day high of 1.4342 against the loonie, more than 2-week high of 1.7144 against the kiwi and an 11-day high of 1.6407 against the aussie, from Thursday's closing values of 1.4297, 1.7023 and 1.6302, respectively. Next key resistance for the euro is likely seen around 1.47 against the loonie, 1.73 against the kiwi and 1.65 against the aussie.

After a brief uptick following the data, the euro slipped to a 2-day low of 0.8353 against the pound. The euro may face support around the 0.82 level.

Looking ahead, Canada retail sales for December and U.S. existing home sales for January are due in the New York session.


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