Euro steady against dollar

The euro continues to trade just below the $1.18 level against the dollar, so off its lows of a little below $1.17 earlier in the week but obviously also still well off its recent highs of around $1.21. Sterling is under pressure against the single currency, falling to over 89p this morning, and the dollar, weakening to under $1.32

Equity market in both the US and Europe closed broadly flat, while yields in the core bonds market ended little changed on the day. Spanish bond yields continued to rise, amid the on-going political  crisis in the country, and in the case of 10-year yields are now some 20bps higher than at the end of last week

The composite PMI in the UK came in at 54.1 in September, broadly unchanged from August. For the third quarter as a whole, the PMI points to GDP growth of 0.3% q-o-q, the same as in Q2 and in line with the Bank of England’s estimate (and probably enough to keep the latter on course to soon raise interest rates)

In the US, the ISM index  of activity in the non-manufacturing sector rose strongly in September to 59.8, a multi-year high, and follows a similarly strong index reading for the manufacturing sector reported earlier in the week

Data due today include jobless claims and the trade balance in the US, while the ECB publishes the minutes of its most recent policy meeting