Poor data means a slower performance for the US dollar, but the currency remains strong

After a strong performance on Tuesday, the dollar slowed its gains on Wednesday – yet it still remained below the 1.30 level against sterling and the 1.11 level against the euro, seeing new 31 year lows against the pound.

Poorer than expected trade balances figures for May could be responsible for the “weakness”– the deficit increased to -US$41.14 billion, which was slightly worse than the -US$40 billion expected. Information from the services sector also fell below expectations, but the released figure of 51.4 it is still a sign of a growing US economy. The Federal Reserve minutes of their last meeting released yesterday evening UK time suggested that US interest rates would be kept on hold until the effect of a Brexit on the US economy could be determined.

Today we await the release of Initial Jobless claims and ADP employment change; these are both good indications of the US economy’s state of affairs and worth keeping an eye on as we have seen worse than expected figures more than once this year.

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