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Dollar rallies as senate backs the Fed

Earlier there had been mixed data in the US but a bad Manufacturing ISM figure was compensated by a better than expected ADP unemployment report. This report is normally a good guide to the non farm payroll figure which is due on Friday. 

Euro/Dollar pushed below the 1.40 level which should signal a downward trend on the pairing in the near term. Cable traded lower but with the Euro/Dollar below 1.40, Sterling made small gains against the Euro. 

Recent poor data in the UK has increased the hopes of a rate cut in the next rate meeting next Thursday. Already today we have had the Nationwide house price survey show that prices are still on the slide.

The ECB meet today but rates are expected to remain at 4.25%. Before the rate announcement we have Euro zone PPI numbers expected to show a lower figure than the previous month. This afternoon we have factory orders and Durable goods figures due in the  US with Factory orders predicted to come in lower and durable goods to remain the same as last months -4.5 numbers. Elsewhere the Japanese continued to perform well having its best time on exchanges for a while.

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