The pound fell to session lows against the dollar on Tuesday after weak
purchasing managers’ index from the euro zone and China underlined
concerns over the outlook for global growth.
GBP/USD hit 1.5197 during European morning trade, the pair’s lowest since April 4; the pair subsequently consolidated at 1.5217, shedding 0.47%.
Cable is likely to find support at 1.5177, the low of April 1 and resistance at 1.5296, the session high.
In the euro zone, data showed that Germany’s manufacturing PMI fell to 47.9 from 49.0 in March, well below the 50 level which separates contraction from expansion.
Germany’s services PMI came in at 49.2, down from 50.9 in March, the fastest rate of contraction in six months.
The euro zone’s manufacturing PMI ticked down to 46.6 from 46.8 in March, worse than expectations for an unchanged reading.
The currency bloc’s services PMI edged up to 46.6 from 46.4 in March, in line with expectations.
The weak data added to fears that the recession in the euro zone would extend into the first quarter and fuelled speculation over a possible rate cut by the European Central Bank.
Earlier Tuesday, a report showed that the preliminary reading of China’s HSBC manufacturing purchasing managers’ index was 50.5 for April, down from a final reading of 51.6 in March.
The weak data appeared to point to a slower rate of growth in the manufacturing sector of the world’s second largest economy.
In the U.K., official data showed that public sector borrowing fell to GBP114.2 billion in the financial year which ended in March, from GBP120.9 billion in the previous financial year.
Sterling was higher against the euro, with EUR/GBP slipping 0.11% to 0.8533.
The U.S. was to release official data on new home sales later in the trading day.
GBP/USD hit 1.5197 during European morning trade, the pair’s lowest since April 4; the pair subsequently consolidated at 1.5217, shedding 0.47%.
Cable is likely to find support at 1.5177, the low of April 1 and resistance at 1.5296, the session high.
In the euro zone, data showed that Germany’s manufacturing PMI fell to 47.9 from 49.0 in March, well below the 50 level which separates contraction from expansion.
Germany’s services PMI came in at 49.2, down from 50.9 in March, the fastest rate of contraction in six months.
The euro zone’s manufacturing PMI ticked down to 46.6 from 46.8 in March, worse than expectations for an unchanged reading.
The currency bloc’s services PMI edged up to 46.6 from 46.4 in March, in line with expectations.
The weak data added to fears that the recession in the euro zone would extend into the first quarter and fuelled speculation over a possible rate cut by the European Central Bank.
Earlier Tuesday, a report showed that the preliminary reading of China’s HSBC manufacturing purchasing managers’ index was 50.5 for April, down from a final reading of 51.6 in March.
The weak data appeared to point to a slower rate of growth in the manufacturing sector of the world’s second largest economy.
In the U.K., official data showed that public sector borrowing fell to GBP114.2 billion in the financial year which ended in March, from GBP120.9 billion in the previous financial year.
Sterling was higher against the euro, with EUR/GBP slipping 0.11% to 0.8533.
The U.S. was to release official data on new home sales later in the trading day.
