Buying focus shifts to the markets outside of the United States. The recent market calm and roughly balanced economic views were disrupted by the latest changes in manufacturing/non-manufacturing PMIs in the US. Especially when compared with the developments in China and Germany last week and this Monday. Trump’s key trading rivals manufacturing PMIs posted welcomed growth for the first time in several months, while manufacturing activity in the US in October was a major disappointment. The dollar sell-off has accelerated after the release of the data from ISM on Monday, which indicated a decrease in a number of key production parameters – production volumes, PPI and employment:

All sub-components of the PMI were in the red zone (“direction” column), and the rate of decline of such key subcomponents, such as employment, new orders and production volumes, accelerated in October:

It‘s worth noting that the manufacturing PMI from ISM is developing a downtrend, despite a series of supportive interest rate cuts, and has been in the decline zone for the fourth consecutive month.

Inflation priced in inflation-indexed bonds fell from a local peak of 1.63% reached on November 8, to 1.54%, amid rising odds of tariff escalation on December 15 and worsening economic data in the US.

UK retail sales declined at a record annual rate of -4.9%. Nevertheless, the change in the sales must be treated with caution, since if we adjust the value of sales on Black Friday and Cyber ​​Monday, the total figure will be + 0.4%. The pound strengthened by 0.38% due to rising broad pressure on the dollar and positive expectations about the December general election.

Against the background of the current situation, we can expect a further weakening of the dollar against the main opponents.

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