US dollar weakens slightly against sterling after interest rate decision

After a lacklustre US Federal Rate decision, i.e. no interest rate increase, and accompanying meeting minutes, the US dollar weakened slightly against sterling due to worries regarding China’s recent struggle and uncertainties over the world economy. Following the interest rate decision we have a handful of US Federal Reserve members speaking this week, which should touch upon the latest decision and minutes. Investors will be analysing these for indications of any underlying Federal Reserve sentiment on whether a hike will happen sooner or later.

This week’s data releases include existing home sales figures on Monday, where a decline is expected from the previous month’s figures, and the flash manufacturing Purchasing Managers’ Index (PMI) on Tuesday, showing continued growth in the usually strong sector. Focus of the week will then be towards Thursday and Friday, with core durable goods and final growth figures released respectively. The former is expected to drop against the previous month’s and just about show a positive figure – this is unsurprising, given that this has struggled since the start of last year. Final second quarter growth figures are expected to remain the same as the initial release, showing the US’s best growth in three quarters.