The US services sector experienced a contraction in February, with the Services Purchasing Managers' Index (PMI) dropping to 49.7 from January's 52.9, marking two consecutive months of decline. This downturn is attributed to a weaker services sector, which has cast a shadow over the economic outlook. Meanwhile, the cash rate in the US has decreased to 3.75%, the lowest level since October 2022, prompting a boost in consumer confidence due to reduced borrowing costs.
Retail sales in the US showed a modest increase of 0.2% in the fourth quarter. Despite the slowdown in the services sector, an uptick in consumer confidence is evident as lower borrowing costs make spending more accessible. Conversely, the manufacturing sector displayed resilience with the Manufacturing PMI climbing slightly to 51.6 from 51.2, suggesting some stabilization within the industrial landscape.
In contrast, the New Zealand dollar remained relatively stable on Monday. Retail sales in New Zealand surged by 0.9% quarter-on-quarter in the fourth quarter of 2024, painting a positive picture for its economy. The Reserve Bank of New Zealand (RBNZ) has embarked on an aggressive rate-cutting spree, slashing rates by 50 basis points in October, November, and February. Governor Adrian Orr indicated that further cuts of 25 basis points each are anticipated in April and May as part of a gradual approach to monetary easing.
On the financial markets front, Solana's price continued its downward trend, trading around $160 on Monday. This recent correction in SOL has resulted in over $26 million in liquidations within the last 24 hours, underscoring volatility in the cryptocurrency market. Meanwhile, gold prices edged slightly higher, trading above $2,640 as investors sought safe-haven assets amid market fluctuations.
The EUR/USD pair struggled to maintain earlier gains, remaining below the 1.0500 mark on Monday. The currency pair's performance reflects ongoing challenges faced by the euro as it contends with external pressures and economic uncertainties.