The Pound recovered some of its losses in yesterday’s trading session after falling against the Euro and US Dollar in the previous night. Warning signs of a hung parliament in the run up to the election damaged the Pound’s strength initially but it rebounded to levels seen earlier this week as it once again tested 1.2900 against the Greenback.
The housing market is seen as one of, if not the main driver in the UK’s economy and home prices have fell for the third consecutive month in May according to Nationwide. It’s no secret that the housing market is past the days of surging house prices like in recent years but the shortage in supply of homes is still likely to support prices. Nationwide have also said a possible link in the loss of momentum could be the pressure on household budgets caused by the weakness of the Pound, prices have rose for imported goods and at the same time inflation has exceeded wage growth.
The contrast of succeeding and struggling economies within the Eurozone this morning has once again been exampled through Manufacturing PMI stats published by Markit. German PMI in May grew comfortably to 59.5, Italy’s worsened from April to 55.1 whilst Greece showed no signs of expansion at all at 49.6, 50 is the benchmark for growth and any reading below signals contraction.
Keep an eye out this afternoon for The ISM Manufacturing PMI in the US before the all-important jobs figures at 1:30pm tomorrow.