Abstract:While economic data will be key today, market sentiment towards monetary policy and policy divergence will also influence.
Earlier in the Day:
It is a relatively busy start to the day on the economic calendar this morning. The Japanese Yen was in action in the early hours.
For the Japanese Yen
In January, the manufacturing PMI rose from 54.3 to 54.6. Economists had forecast a decrease to 54.0. More significantly, the services PMI slid from 52.1 to 46.6. Economists had forecast a decline to 52.0.
According to the prelim January survey,
Private sector activity dipped for the first time in 4-months, with the composite PMI falling from 51.8 to 48.8.
Service sector activity fell at the sharpest pace since August, overshadowing a modest pickup in manufacturing sector activity.
The spread of the Omicron strain weighed on service sector activity in the month.
Looking at the sub-components:
Firms across the services sector reported a fall in new orders, while manufacturers reported strong growth. New export orders followed a similar trend.
Employment fell for the first time in a year, with service sector firms reporting a stronger decline.
Backlogs of work declined as a result of a fall in backlogs across the services sector.
Input and output prices pointed to softer inflation.
Optimism across the private sector dipped. Service sector optimism fell to a 12-month low, while manufacturing sector optimism fell to a 5-month low.
The Japanese Yen moved from ¥113.809 to ¥113.807 upon release of the figures. At the time of writing, the Japanese Yen was down by 0.18% to ¥113.890 against the U.S Dollar.
Elsewhere
At the time of writing, the Aussie Dollar was down by 0.01% to $0.7184, while the Kiwi Dollar was up by 0.01% to $0.6718.
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Wednesday's major data releases and macroeconomic events are expected to cause volatility to increase after another day of erratic trading in the financial markets. The Spring Budget for the UK will be released, and January Retail Sales figures for January will be made available by Eurostat. ADP Employment Change for February and January JOLTS Job Openings will be discussed later in the session on the US economic docket.
Major currency pairings are still trading in familiar ranges early on Tuesday after the erratic trading on Monday. The US economic docket for the American session will include the factory orders data for January and the ISM Services PMI survey for February. Final updates to the February PMI for the US, Germany, the UK, and the EU will also be released by S&P.
Weekend trading has gained great popularity in recent years due to the rise of online and mobile trading platforms that provide retail investors easy access to markets outside of regular working hours. For traders with Monday-Friday, 9-to-5 jobs, trading on weekends allows them to be active in markets at convenient times.
West Texas Intermediate (WTI) oil price pauses its two-day winning streak but is anticipated to conclude the week on a positive note, trading near $77.00 per barrel during the Asian session on Friday.