GBP/USD Daily Fundamental Forecast – April 04, 2017
The GBPUSD was one of the few pairs which managed to have something like a normal trading range on a day when volatility was generally low in the markets and the traders sought to take a break of sorts on the first trading day of the quarter. There was not much happening around and the effect of that was seen in the markets which had a dull day of trading. The GBPUSD pair managed to have a range of around 90 pips mainly due to the fall that was caused by the PMI data.
Pound Falls on Bad PMI
The PMI data was released from the UK and it came in lesser than expected. This bucked the trend of good data from the UK, which we have been seeing over the last few months and hence disappointed the bulls and pushed the pound below 1.25 where it trades as of this writing. The pair found some support in the 1.2480 region and so far, it has managed to hold on to this region and today, it might be looking to bounce from there.
The dollar was pretty steady yesterday as the PMI data from the US was along expected lines and a bomb going off in St. Petersburg added to the dollar strength as there was a slight flight to safety for the good money which usually helps the dollar. The market is basically in a wait and watch mode for the news events scheduled for later in the week.
Looking ahead to today, we do not have any major news from the US for today but we have the Construction PMI data from the UK which would be another piece of data that the markets would be watching closely, especially as the PMI data from yesterday fell below expectations. The market would like to know whether this would become a trend and point to the economy weakening or whether this is just a blip and only the incoming data would help us to know that.