Investing.com - The pound edged lower against the U.S. dollar on Monday, after the contraction in U.K. manufacturing activity in July was confirmed to be worse that initially estimated, fueling further concerns over the outlook for growth in Britain.
GBP/USD hit 1.3201 during European morning trade, the session low; the pair subsequently consolidated at 1.3208, slipping 0.14%.
Cable was likely to find support at 1.3070, the low of July 27 and resistance at 1.3305, the high of July 29.
Research group Markit said its U.K. manufacturing purchasing managers’ index fell to 48.2 last month from a reading of 52.1 in June.
It was the lowest level since early 2013 and worse than a preliminary report released on July 22 that had shown a drop to 49.1 in July.
The dowbeat data added to concerns over the strength of the U.K. economy and boosted expectations for a rate cut by the Bank of England at its policy meeting this week.
Meanwhile, sentiment on the greenback remained fragile after the advance read on second quarter U.S. gross domestic product showed on Friday a 1.2% annualized growth rate, well below expectations for 2.6%. First quarter GDP was revised lower to 0.8% from 1.1%.
The disappointing data lessened expectations for an early interest rate rise from the Federal Reserve.
Sterling was steady against the euro, with EUR/GBP at 0.8452.