Headline US jobs data again comfortably beat market expectations, although the overall data was more mixed.

Headline US jobs data again comfortably beat market expectations, although the overall data was more mixed while there was an impressive rebound for the manufacturing ISM.

The dollar secured only limited gains given a lack of conviction over trends and expectations of a patient Federal Reserve with EUR/USD just below 1.1450.

The firm US data did help support global equities, although several Asian markets were closed on Monday with China closed for the week.

Oil prices pushed to fresh 2-month highs and commodity currencies made net gains, although weak domestic housing data undermined the Australian dollar.

Precious metals lost ground with gold slipping from 8-month highs.

The UK PMI manufacturing index declined to 52.8 for January from 54.2 previously and the second-lowest reading since July 2016 with subdued new orders growth. Activity was also boosted by further aggressive inventory building which maintained concerns that growth would not be sustainable. Sterling had already weakened and was unable to gain any support after the data with further concerns that uncertainty would undermine activity, especially with evidence of a tough stance from the EU.

GBP/EUR fell towards 1.1380 before a correction higher. The UK currency did secure protection from a fresh advance in oil prices with GBP/EUR bouncing from the overnight lows at 1.1377 while there was further GBP/USD resistance close to 1.3100.

Prime Minister May will push for a fresh EU response to alternative Northern Ireland backstop plans and the EU response will be important for Sterling sentiment with no votes scheduled in parliament this week. The UK currency was unable to secure renewed gains on Monday with unease surrounding the car sector a negative factor as markets monitored Brexit rhetoric.

Economic Calendar

Expected Previous
07:00 IPC-Fipe Inflation Idx*(JAN) - 0.09%
08:30 European Central Bank Yves Mersch Speech - -
09:30 GBP PMI Construction(JAN) - 52.8
09:30 Euro-Zone Sentix Investor Confidence(FEB) -2.8 -1.5
10:00 CPI (EU Norm) Final MM*(JAN) -1.90% -0.10%
10:00 CPI (EU Norm) Final YY*(JAN) 3.20% 4.00%
15:00 USD Factory Orders(NOV, 2018) 0.20% -2.10%

*All rates shown are indicative of interbank rates and should only be used for indication purposes only. It is important to note that foreign exchange rates fluctuate and that rates may vary depending on the amount and the base currency that is purchased or sold. Rates are correct as of 8:00am UK time. CentralFX are not responsible for the rates shown.