Things have truly settled down since the week end and Monday’s frantic panic. The safe haven play has been unwound and so it’s back to normal for now with the dollar seeing little traction and yet to truly gain the backing of investors, despite the expectation of further tapering from the Federal Reserve throughout the year. Overnight the Aussie spiked following some better than expected services and GDP data almost hitting 0.9000 against the dollar but now currently sits at 0.8970. The services PMIs remain the theme of today with data from across Europe and the UK this morning. Italy and France are expected to show their services sector remain in contraction territory below the 50.0 mark meanwhile Germany and the UK well into expansion with figures of 55.4 and 58.0 expected respectively. The Eurozone figure will also be closely watched due to come in at 51.7 and any improvement on that will help to quell disinflation concerns and could give EURUSD an excuse to head back towards 1.3800.
Later focus will shift across the pond to the US as we see the nonfarm payroll’s little brother released, in the form of the ADP figure which is expected to record 160k, down from last month. Recently the two have shown separate trends with the ADP number remaining relatively high compared to the nonfarms that have been far more erratic. As the weather settles down in the US then so should the employment picture. Also to bear in mind today is the US’s ISM non-manufacturing figures which will be closely watched in this data packed trading day.