Pound Drops As U.K. Manufacturing Growth Slows More Than Expected
31 Enero 2019 - 11:45PM
RTTF2
The pound drifted lower against its major counterparts in the
early European session on Friday, as a data showed that UK
manufacturing growth slowed more-than-expected in January to its
lowest level in three months.
Survey data from IHS Markit showed that the IHS Markit/CIPS
Purchasing Managers' Index for manufacturing fell to 52.8 from 54.2
in December. Economists had forecast a score of 53.5.
A PMI reading above 50 suggests growth in the sector. The latest
reading was the second-weakest since July 2016, which was the first
month after the Brexit referendum.
Also in focus is U.S.-China trade talks that ended in Washington
with positive words.
While China promised to "substantially" expand purchases of U.S.
goods, U.S. President Donald Trump said the trade dispute would
hopefully be resolved before the March 1 deadline.
The currency traded mixed against its key counterparts in the
Asian session. While it rose against the franc and the yen, it fell
against the greenback and the euro.
The pound declined to a 10-day low of 0.8793 against the euro,
from a high of 0.8727 hit at 2:30 am ET. The next possible support
for the pound is seen around the 0.89 level.
Survey data from IHS Markit showed that Eurozone manufacturing
sector moved closer to stagnation in January amid a modest gain in
output and a sharp fall in new orders.
The final Eurozone manufacturing Purchasing Managers' Index
dropped to 50.5, in line with the flash estimate, from 51.4 in
December. A PMI reading above 50 suggests growth in the factory
sector.
Reversing from an early high of 1.3115 against the greenback,
the pound fell to an 8-day low of 1.3044. The pound is seen finding
support around the 1.28 level.
Having climbed to 142.87 against the yen at 7:15 pm ET, the
pound changed its direction and dropped to a 9-day low of 142.08.
Next key support for the pound is likely seen around the 140.00
region.
The latest survey from Nikkei showed that Japan's manufacturing
sector continued to expand in January, albeit at a slower pace,
with a manufacturing PMI score of 50.3.
That's down from 52.6 in December, although it remains above the
boom-or-bust line of 50 that separates expansion from
contraction.
The pound weakened to a 9-day low of 1.2949 against the franc,
following a high of 1.3054 touched at 2:30 am ET. On the downside,
1.27 is possibly seen as the next support level for the pound.
Looking ahead, U.S. construction spending for December, nonfarm
payrolls data, ISM manufacturing index and University of Michigan's
final consumer sentiment index for January are scheduled for
release in the New York session.
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