Currencies round up – Euro falls, Yuan rallies and Dollar is steady

Euro is not impressed by economic data

The common currency fell despite good business activity data as purchasing managers generally start to doubt in the power of the European Union. Ongoing Brexit talks made Purchasing Managers Index hit its lowest point since end of 2016. Though business growth speed up in June and there are hopes that the European Central Bank will finally decide to tighten its quantity loosing policy, the Euro exchange rate was at 1.1639 dollars, 0.1 percent down comparing to the previous day.

Steady US Dollar awaits data publication

The Independence Day means trading is off on Wednesday, but the next days shall bring many analytic data that could impact the US Dollar exchange rate. FED minutes from June’s meeting will be published on Thursday, whereas on Friday data on US jobs will be exposed. That means in next days it will be the US Dollar that will influence the exchange rate against the other currencies, not the Euro. Market analytics expect that area of 1.1680-1.1720 in EUR/USD will be hard to break. So far, despite the Euro displaying a bit of sluggishness, the situation is quite steady among that pair of currencies. The US Dollar index against six major other currencies was at 94.650 on Wednesday, quite close to its 11-month high. It has been on the rise for three past months now.

Chinese Yuan rebounds

The Chinese Yuan gained 0.8 percent, rallying after its rebounding from an 11-month low as the central bank intervened to stop its sharp slide.  The exchange rate USD/CNY was at 6.6168. The Governor of the People’s Bank of China, Yi Gang, gave some reassuring remarks on Tuesday which helped the Chinese Yuan got back on its feet and record gains. The Governor of the People’s Bank of China cut down speculations that it had been using the weaker Yuan in trading wars. Though it seems investors are not that eager to believe that optimism in China is here to stay. Especially since only on Friday the US higher tariffs on Chinese goods worth $34 billion will be implemented. China tries to convince the European Union to issue a joint statement condemning the US President Donald Trump’s trade policies, as the rumours have it.

British Pound is on the rise

Meanwhile the British Pound went higher on Wednesday. It was mainly due to the good display of dominant services industry. Thanks to that, hopes arisen that the Bank of England will decide on interest rates hike soon. The beginning of the year was slow for the British economy, but times appear to be changing as there are signs of growing momentum for the industry. Though the Brexit deal is far from be settled on and the deadline of the UK’s exit from the European Union – next March – is fast approaching, investors decide to focus on some good news instead. After weeks of Brexit weighing down the exchange rate of the British Pound, the situation took a better turn and the GBP rose to $1.3201. It was a five-days high.

Troubles for Czech crown

The Czech Crown fell to the lowest point in 11 months against the Euro, hitting 26.183, and trading at 26.155, down 0.3 percent. The poor result was due to selling pressure that is spread among the emerging markets. Whereas the Australian Dollar gained on good domestic retail sales outcome and was trading at $0,7385. Up was also the Swedish Crown, 0.3 percent against the Euro to 10.265 crowns. After the Central Bank of Sweden hinted on Tuesday that tightening of policy is on the maps, SEK recorded gains in two consecutive days.

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