TheÂ Sterling pound today declined significantly against theÂ US dollar following theÂ release ofÂ theÂ Markit/CIPS UK Manufacturing PMI inÂ theÂ early European session. TheÂ pound’s decline was further accelerated byÂ theÂ US dollar’s recovery asÂ it extended its gains atÂ theÂ start ofÂ theÂ new month.
TheÂ GBP/USD currency pair lost over 100 points toÂ decline from anÂ opening high ofÂ 1.3773 toÂ trade atÂ aÂ low ofÂ 1.3667 atÂ theÂ time ofÂ writing.
TheÂ currency pair’s decline begun inÂ theÂ Asian session andÂ accelerated inÂ theÂ early European session following theÂ release ofÂ theÂ Markit UK Manufacturing PMI data. TheÂ manufacturing PMI came inÂ atÂ 53.9, which was lower than theÂ expected 54.8, triggering theÂ massive drop. TheÂ release ofÂ theÂ UK money andÂ credit report forÂ March byÂ theÂ Bank ofÂ England also contributed toÂ theÂ pair’s decline. According toÂ theÂ report, broad money decreased byÂ Â£0.9 billion inÂ March. Within this, theÂ flow ofÂ households’ M4 was Â£4.7 billion, above theÂ recent average ofÂ Â£2.3 billion. TheÂ flow ofÂ private non-financial corporations’ (PNFCs’) M4 was -Â£0.5 billion. Mortgage approvals were broadly unchanged onÂ theÂ month, while approvals forÂ house purchases were slightly lower atÂ 62,91.
TheÂ weak releases from theÂ UK docket pushed theÂ pound lower asÂ investors interpreted theÂ news asÂ aÂ sign that theÂ BoE’s Monetary Policy Committee might not hike rates during its May meeting.
TheÂ currency pair’s short-term performance is likely toÂ be affected byÂ theÂ release ofÂ theÂ US ISM Manufacturing andÂ Employment reports later today.
TheÂ GBP/USD currency pair was trading atÂ 1.3691 asÂ atÂ 10:06 GMT having declined from aÂ high ofÂ 1.3773. TheÂ GBP/JPY currency pair was trading atÂ 150.15 having dropped from aÂ high ofÂ 150.63.
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