Dear Reader,

Today's overview of economic news and market action

• Mixed mood on markets yesterday …
• Currency-wise, traditional safe havens were on the front foot during the European session …
• However, the dollar handed back its gains overnight …
• Sees EUR/USD open in the lower half of $1.07-1.08 …
• GBP/USD is operating at the midpoint of $1.25-1.26 …
• EUR/GBP is at the halfway mark of the 85-86p range …
• USD/JPY is down at the ¥153 threshold …
• Today, the main  highlight will be the US labour market report for April …

Steepest fall in new orders since December 2022

AIB Ireland Manufacturing PMI® data signalled a sustained reduction in output volumes and incoming new work during April, with both rates of decline accelerating since the previous survey period. Total new business decreased to the greatest extent for 16 months, in part reflecting a sharp fall in export sales.

Tide Turning for the Eurozone Economy?

This week’s macro data provided further evidence that the US economy is beginning to slow from the rapid pace of growth seen in 2023. The 1.6% rise in GDP in Q1 was well below the market consensus of 2.4%, and reflected a broad-based slowdown in both domestic spending and net exports.

ECB signals June rate cut on the cards

As widely anticipated, the ECB’s Governing Council meeting for April saw the central bank maintain its key deposit rate at 4%. It marked the fifth consecutive policy meeting that the ECB has kept rates unchanged. There was “consensus” rather than unanimity within the Governing Council on the decision.

PMI fell to 49.6 in Mar. The slight decline reflected a fall in new business and output and a sharp drop in sentiment. Meantime, inflationary pressures in the sector continued to build