For more easy access on your mobile phone,,,,,,Download our mobile application on your mobile : Click Fxsignals
The pound fell below 1.50 against the dollar for the first time since July 2010 on Friday as unexpectedly weak U.K. manufacturing data added to expectations that the Bank of England will resume its quantitative easing program.
GBP/USD hit a session low of 1.4986, the pair’s lowest since July 13 2010, before settling at 1.5035, 0.85% lower for the day and down 0.86% for the week.
Cable is likely to find support at 1.4855 and resistance at 1.5185, Friday’s high.
The U.K. manufacturing purchasing managers’ index fell to 47.9 from 50.5 in January, well below the 50 level that divides growth from contraction, as employment levels in the sector fell at the fastest pace in more than three years. Economists had expected the PMI to rise to 51.0.
The shock contraction fuelled expectations for further monetary easing by the BoE after the minutes of the central bank’s February meeting indicated that policymakers are moving closer to another round of asset purchases.
Earlier in the week, revised data confirmed that the U.K. economy contracted 0.3% in the three months to December, in line with initial estimates and economists’ forecasts.
The economy expanded by 0.3% year-on-year, better than initial estimates of flat output.
The weak data reinforced concerns over the threat of a triple-dip recession, after ratings agency Moody’s downgraded the U.K.’s triple-A rating by one notch last month, citing a weak outlook for growth and a rising debt burden.
The dollar strengthened broadly on Friday after data showed that the U.S. manufacturing sector expanded at its fastest pace since June 2011 last month, while a separate report showed that U.S. consumer confidence rose in February.
The Institute for Supply Management said its manufacturing PMI rose to 54.2 from 53.1 in January, while the final reading of the University of Michigan’s consumer sentiment index came in at 77.6, from a preliminary reading of 76.3.
The dollar also found support amid worries over U.S. spending cuts, known as the sequester, after lawmakers failed to reach an agreement on a deficit reduction plan.
In the week ahead, markets will be focusing Thursday’s interest rate decision by the BoE as well as U.K. data on service sector activity. Friday’s data on U.S. nonfarm payrolls will also be closely watched as investors attempt to gauge the strength of the economic recovery.
Ahead of the coming week, Investing.com has compiled a list of these and other significant events likely to affect the markets.
Monday, March 4
The U.K. is to release data on construction sector activity, a leading indicator of economic health.
Tuesday, March 5
The U.K. is to produce data on service sector activity, a leading economic indicator, as well as industry data on retail sales.
In the U.S., the ISM is to release a report on service sector activity, a leading indicator of economic health.
Wednesday, March 6
The U.S. is to publish data on ADP nonfarm payrolls, which leads government data on nonfarm payrolls by two days. The U.S. is also to release official data on factory orders and crude oil stockpiles.
Thursday, March 7
The BoE is to announce its benchmark interest rate.
The U.S. is to publish the weekly government report on initial jobless claims and official data on the trade balance.
Friday, March 8
The U.S. is to round up the week with government data on nonfarm payrolls and the unemployment rate and data on average hourly earnings.
The pound fell below 1.50 against the dollar for the first time since July 2010 on Friday as unexpectedly weak U.K. manufacturing data added to expectations that the Bank of England will resume its quantitative easing program.GBP/USD hit a session low of 1.4986, the pair’s lowest since July 13 2010, before settling at 1.5035, 0.85% lower for the day and down 0.86% for the week.
Cable is likely to find support at 1.4855 and resistance at 1.5185, Friday’s high.
The U.K. manufacturing purchasing managers’ index fell to 47.9 from 50.5 in January, well below the 50 level that divides growth from contraction, as employment levels in the sector fell at the fastest pace in more than three years. Economists had expected the PMI to rise to 51.0.
The shock contraction fuelled expectations for further monetary easing by the BoE after the minutes of the central bank’s February meeting indicated that policymakers are moving closer to another round of asset purchases.
Earlier in the week, revised data confirmed that the U.K. economy contracted 0.3% in the three months to December, in line with initial estimates and economists’ forecasts.
The economy expanded by 0.3% year-on-year, better than initial estimates of flat output.
The weak data reinforced concerns over the threat of a triple-dip recession, after ratings agency Moody’s downgraded the U.K.’s triple-A rating by one notch last month, citing a weak outlook for growth and a rising debt burden.
The dollar strengthened broadly on Friday after data showed that the U.S. manufacturing sector expanded at its fastest pace since June 2011 last month, while a separate report showed that U.S. consumer confidence rose in February.
The Institute for Supply Management said its manufacturing PMI rose to 54.2 from 53.1 in January, while the final reading of the University of Michigan’s consumer sentiment index came in at 77.6, from a preliminary reading of 76.3.
The dollar also found support amid worries over U.S. spending cuts, known as the sequester, after lawmakers failed to reach an agreement on a deficit reduction plan.
In the week ahead, markets will be focusing Thursday’s interest rate decision by the BoE as well as U.K. data on service sector activity. Friday’s data on U.S. nonfarm payrolls will also be closely watched as investors attempt to gauge the strength of the economic recovery.
Ahead of the coming week, Investing.com has compiled a list of these and other significant events likely to affect the markets.
Monday, March 4
The U.K. is to release data on construction sector activity, a leading indicator of economic health.
Tuesday, March 5
The U.K. is to produce data on service sector activity, a leading economic indicator, as well as industry data on retail sales.
In the U.S., the ISM is to release a report on service sector activity, a leading indicator of economic health.
Wednesday, March 6
The U.S. is to publish data on ADP nonfarm payrolls, which leads government data on nonfarm payrolls by two days. The U.S. is also to release official data on factory orders and crude oil stockpiles.
Thursday, March 7
The BoE is to announce its benchmark interest rate.
The U.S. is to publish the weekly government report on initial jobless claims and official data on the trade balance.
Friday, March 8
The U.S. is to round up the week with government data on nonfarm payrolls and the unemployment rate and data on average hourly earnings.
Posts
0 comments :
Post a Comment