<ul><li>Prior 6.6%</li></ul><p style=““ class=“text-align-justify“>A slight tick lower in the jobless rate as it reaffirms that labour market conditions are holding up. But amid some softer economic data from Europe in the past month, we have seen the PMI reports note a bit of a hit to employment conditions. That might be something that will translate to labour market data if things worsen going into next year.</p>

This article was written by Justin Low at forexlive.com.

<p style=““ class=“text-align-justify“>The UK manufacturing sector continues to contract in November, with output, new orders and employment all falling further on the month. Meanwhile, business sentiment also dips to its lowest level since April 2020 as the outlook deteriorates markedly. The only consolation is that inflation pressures are easing a little, with input prices falling to a three-month low. S&P Global notes that:</p><p style=““ class=“text-align-justify“>“November saw a further contraction of the UK manufacturing sector, as weak demand, declining export sales, high energy prices and component shortages all hit industry hard. </p><p style=““ class=“text-align-justify“>“The outlook for the sector also darkened, as confidence among manufacturers fell to its lowest level since April 2020. Weak sentiment and declining intakes of new work led to job losses, a retrenchment in purchasing activity and an accumulation of finished goods inventory that will likely provide a further brake to output during the months ahead. Companies are also reporting rising recession fears, weak consumer spending and subdued client confidence. </p><p style=““ class=“text-align-justify“>“The trend in new export business was especially weak, as Brexit issues and supply chain stresses exacerbated the effects of a weakening global economic backdrop, leading to lower sales from the US, the EU and China. On a slightly more positive note, manufacturers saw a welcome easing in input price <a target=“_blank“ href=“https://www.forexlive.com/terms/i/inflation/“ target=“_blank“ id=“ad51a5a2-1afc-4f42-9e62-ea6faf6f90fa_2″ class=“terms__main-term“>inflation</a>. However, firms are still reporting that the direct and indirect impacts of high energy prices remain a major concern.”</p>

This article was written by Justin Low at forexlive.com.

<p style=““ class=“text-align-justify“>Football’s coming home.. England’s progress to the RO16 in Qatar is certainly helping to lift the mood. I kid.</p><p style=““ class=“text-align-justify“>But with the dollar plunge yesterday, it has certainly reinvigorated the pair in a push from below 1.2000 to above 1.2100 today. Since the break higher in November, price action has been caught between its 100-day moving average (red line) and 200-day moving average (blue line). Right now, we are closing in on the latter with a 0.5% move up to 1.2117.</p><p style=““ class=“text-align-justify“>That puts the focus on buyers‘ appetite to chase the next upside leg, with the 200-day moving average at 1.2151 in the crosshairs. Keep below that and sellers will be able to try and stay in the game. But break above, and buyers will have renewed vigour to take a run at the August highs at 1.2276-93 before revisiting 1.2500 potentially.</p><p style=““ class=“text-align-justify“>The timing of the move comes alongside some other key technical moves against the dollar as outlined here:</p><ul><li><a target=“_blank“ href=“https://www.forexlive.com/news/usdjpy-stays-under-heavy-pressure-on-falling-yields-20221201/“ target=“_blank“ rel=“follow“>USD/JPY stays under heavy pressure on falling yields</a></li><li><a target=“_blank“ href=“https://www.forexlive.com/news/eurusd-still-has-some-work-to-do-to-firmly-establish-next-upside-leg-20221201/“ target=“_blank“ rel=“follow“>EUR/USD still has some work to do to firmly establish next upside leg</a></li><li><a target=“_blank“ href=“https://www.forexlive.com/news/audusd-looks-to-build-on-yesterdays-technical-break-higher-20221201/“ target=“_blank“ rel=“follow“>AUD/USD looks to build on yesterday’s technical break higher</a></li></ul><p style=““ class=“text-align-justify“>And not forgetting, there’s also another key risk event before the week comes to a close, with the US non-farm payrolls tomorrow. That might yet be a key catalyst for any moves before the weekend.</p>

This article was written by Justin Low at forexlive.com.

<p style=““ class=“text-align-justify“>Eurozone manufacturing activity continues to contract further in November, albeit at a slower pace than in October at least. Output and new orders were both seen declining again, while <a target=“_blank“ href=“https://www.forexlive.com/terms/i/inflation/“ target=“_blank“ id=“ad51a5a2-1afc-4f42-9e62-ea6faf6f90fa_1″ class=“terms__main-term“>inflation</a> pressures eased in part due to weaker demand and also reduced strain on suppliers. This is a theme that is seen across all the individual country reports today. S&P Global notes that:</p><p style=““ class=“text-align-justify“>“The PMI signals some welcome moderation in the intensity of the eurozone manufacturing downturn in November, which will support hopes that the region many not be facing a winter downturn as severe as previously anticipated by many. However, the survey’s production index continuing to run at one of the lowest levels recorded over the past decade. At these levels the survey is indicative of a marked annualised rate of contraction of approximately 4%. While official manufacturing data have been more buoyant – and more volatile – in recent months, such weak PMI readings have always been followed by commensurate steep declines in the official statistics. </p><p style=““ class=“text-align-justify“>“There also seems to be no immediate respite in sight for the plight of manufacturers, given that order books continue to deteriorate at a worryingly steep pace, contracting at a far faster rate than firms are cutting production. Inventories of unsold stock are therefore rising further and follow on from the largest build-up of finished goods inventories in the quarter century history of the survey in recent months. Such a stock build-up will inevitably be followed by further production capacity cuts, absent a revival in demand. </p><p style=““ class=“text-align-justify“>“A consequence of the recent inventory build-up and softening of demand has been a major pull-back in purchases of inputs by manufacturers, which has in turn taken pressure off supply chains. Supplier delivery times lengthened in November to the smallest extent since August 2020, and are now even improving in Germany. This improvement in supply is an important signal of a shift from a sellers’ to a buyers’ market, and is hence being accompanied by a significant cooling of industrial price pressures. </p><p style=““ class=“text-align-justify“>“Looking ahead, future output expectations have picked up slightly on improved supply chain and energy market signals, the latter buoyed by warmer than usual autumn weather, but confidence remains amongst the lowest seen over the past decade. How manufacturers fare over the winter months will of course be conditional to a large extent on the weather, with any cold snaps likely to fuel concerns over energy resources and potentially hitting production and supply chains further.”</p>

This article was written by Justin Low at forexlive.com.