Pound Falls Then Rallies on Weak UK Services PMI and BoE Rumours

The Sterling pound today traded lower against the US dollar earlier in the session as investors stayed away from the pound amid Brexit uncertainty and risk-off market sentiment. However, the GBP/USD currency pair later recovered despite the release of weak UK PMI data by Markit Economics amid rumours that the Bank of England would cut rates soon.
The GBP/USD currency pair today fell to a low of 1.2770 in the early London session before recovering and rallying to a high of 1.2846 and was trading near this high at the time of writing.
The currency pair headed lower at the start of today’s session as the US dollar found a floor after yesterday’s selloff, which was triggered by the emergency Fed rate cut. The pair was under intense selling pressure as the risk-off sentiment permeated the markets as coronavirus cases in the UK rose. The release of the weak Markit/CIPS UK Services PMI, which came in at 53.2 missing consensus estimates set at 53.3, drove the pair lower. However, the pair rallied higher later as buyers stepped in despite rumours that the Bank of England rumours.
The pair had a muted reaction to the upbeat US ADP employment change report released in the early American session. The pair fell slightly after the release of the US ISM non-manufacturing PMI for February, which came in at 57.3 versus the expected 54.9.
The currency pair’s future performance is likely to be affected by Mark Carney’s speech tomorrow and geopolitical headlines.
The GBP/USD currency pair was trading at 1.2845 as at 18:03 GMT having risen from a low of 1.2770. The GBP/JPY currency pair was trading at 137.99 having rallied from a low of 137.21.

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