Contrasting Fortunes for Forex Market Big Hitters as Stocks Move Higher

• Positive Data but GBP/USD Struggles
• EUR/USD Buoyed by Optimism
• US-China Trade Deal Still Alive

Although the Pound has managed to break a four-day losing streak to begin the week, the pair has struggled to gain further traction in the forex market on Tuesday. This comes even as UK PMIs come inn at more positive rates than expected. On the other side of the coin, the Euro is gaining strength on upbeat US data and a general sense of optimism in the market. This all comes on a day when the American markets too have opened strongly as the trade deal with China does not seem to be off the table as had previously been thought.

UK PMIs Hit Four Month High Point

The GBP/USD had been struggling throughout last week. Forex brokers had noted that the cable fell to near monthly lows. This losing streak was balanced somewhat by a sharp gain in trading of more than 1% yesterday. Further advances beyond the 1.25 mark have so far been rebuffed though. The major concerns holding back Sterling here appear to be the ongoing Brexit negotiation saga, and fears over where this will leave the UK future in trade.

Positive news though, is that the British economy in general, appears to be bouncing back. The manufacturing PMI figures came in at 50.8, while the services data also hit a multiple month high point of 47.0. These more than optimistic numbers are still tempered slightly by the fact that the British economy is forecasted to shrink almost 12% in 2020, with a rebound of around 5% expected by analysts in the following year.

Euro Marching Forward on More Positive Data

PMI Data across the EU was also released today. This came in above expectations, with preliminary numbers in manufacturing noting a sharp upturn to 46.9. The Euro has taken this opportunity, along with the support of US markets, and driven above the 1.13 benchmark.

US PMI numbers are also set to be released today. Analysts are expecting a similar bounce back as the country continues to get back to work. This is despite a rising number of coronavirus cases in some states. Florida as an example has noticed a surge in numbers, and have just recently crossed 100,000 cases. Still though, there are no plans to scale back plans for reopening.

US-China Trade Deal Still on the Table

There had been widespread concern from those forex trading, and across the markets overnight that the US-China trade deal may be dead in the water. White House trade advisor Peter Navarro has insisted that his words were taken out of context, and that the deal is still very much in place. President Trump has further backed up this stance.

News that the deal was still alive has had a suitable impact on the US market too. Early trading shows that the major indices are all trading up, with the NASDAQ continuing to hit new heights.