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Forex - GBP/USD falls as U.K. manufacturing PMI disappoints

Published 11/01/2013, 05:38 AM
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Investing.com - The pound fell against the U.S. dollar on Friday, after the release of disappointing U.K. manufacturing data, while speculation the Federal Reserve could begin tapering its stimulus program sooner than expected continued to support the greenback.

GBP/USD hit 1.5989 during European morning trade, the pair's lowest since October 17; the pair subsequently consolidated at 1.5995, shedding 0.27%.

Cable was likely to find support at 1.5894, the low of October 16 and resistance at 1.6144, the high of October 29.

Markit research group said the U.K. manufacturing purchasing managers' index fell to 56.0 in October, from a downwardly revised reading of 56.3 the previous month. Analysts had expected the index to tick down to 56.1 last month.

Meanwhile, the dollar remained supported as a recent series of positive U.S. data added to expectations for the Federal Reserve to begin tapering its stimulus program sooner than expected.

On Thursday, data showed that manufacturing activity in the Chicago region expanded at the fastest rate in 30 years in October, while a separate report showed that U.S. initial jobless claims fell in line with expectations last week.

Sterling was higher against the euro with EUR/GBP sliding 0.28%, to hit 0.8446.

Later in the day, the U.S. was to release a report from the Institute of Supply Management on manufacturing activity.


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