GBP/USD stays below 1.23 after UK Sept Manufacturing PMI rebounds to 48.3
|The UK manufacturing sector activity contraction unexpectedly slowed in the month of September, the latest survey report from IHS Markit showed this Tuesday.
The seasonally adjusted IHS Markit/CIPS UK Purchasing Managers’ Index (PMI) jumped to four-month highs of 48.3 in September versus 47.0 expected and seven-year lows of 47.4 seen in August.
Key Points:
New orders, output and employment fall further
Purchasing and input stocks rise as Brexit preparations restart.
Rob Dobson, Director at IHS Markit, commented on the survey:
“The UK manufacturing downturn continued in September, adding to signs that the sector may be sliding into recession. Output, new orders and employment all fell further as rising political, trade and economic uncertainties exacerbated concerns about Brexit.”
“Some manufacturers noted increased inventory building activity in preparation for the forthcoming exit date, but the impact of such Brexit-related stock building was dwarfed by weakening demand for other customers, due in part to clients routing supply chains away from the UK.”
FX Implications:
A positive surprise in the UK Manufacturing sector activity data fails to lift the sentiment around the pound. The Cable keep its recovery from three-week lows of 1.2263 capped below the 1.2300 level on the data release.
The GBP markets remain confused after the UK PM Johnson brushed away criticism of leaked plans to manage the Irish border after Brexit. Also, markets refrain from placing any directional bet on the pound ahead of PM Johnson’s new Brexit plan announcement.
GBP/USD Levels to consider
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.