Weak China services growth and return of US investors after Labor Day pushes US dollar to six-month high, says Axel Rudolph, Senior Market Analyst at online trading platform IG.
China service sector growth at 8-month low
“Lower-than-expected China services growth – even though still in expansionary territory – has helped push the greenback to fresh six-month highs on flight-to-quality flows. With US players back from their Labor Day holiday trading volumes have also picked up ahead of tomorrow’s US August ISM services PMI data.”
RBA rates unchanged and weak Eurozone PMIs
“AUD/USD slid to a 10-month low as the RBA kept rates unchanged at 4.1% for a third straight meeting and the greenback appreciates. EUR/USD dropped to a 3-month low and European bourses fell on weak Eurozone PMIs and as inflation expectations rise. Tomorrow’s BOC rate decision, Fed Beige Book and US ISM services PMI data may increase volatility further still.”