For the 24 hours to 23:00 GMT, the GBP rose 0.49% against the USD and closed at 1.3202, as the release of upbeat UK economic data sparked a fresh wave of optimism over the health of the British economy.
Data showed that Britain’s manufacturing production rose 0.4% on a monthly basis in August, beating market consensus for an advance of 0.2%. In the previous month, manufacturing production had registered a revised similar rise. Moreover, the nation’s industrial production recorded a rise of 0.2% MoM in August, meeting market expectations. In the previous month, industrial production had risen by a revised 0.3%. Further, the nation’s construction output unexpectedly rebounded 0.6% on a monthly basis in August, rising for the first time in four months and confounding market expectations for a flat reading. Construction output had registered a revised drop of 1.0% in the previous month.
However, other economic data revealed that total trade deficit in the UK surprisingly widened to £5.6 billion in August, while investors had envisaged the total trade deficit to narrow to £2.8 billion. The UK had reported a revised total trade deficit of £4.2 billion in the prior month. On the contrary, the NIESR estimated UK’s gross domestic product (GDP) climbed 0.4% in the three months to September, after recording a revised expansion of 0.5% in the June-August period.
Separately, the IMF stated that it still expects UK economy to grow by 1.7% in 2017 and 1.5% in 2018.
In the Asian session, at GMT0300, the pair is trading at 1.3193, with the GBP trading 0.07% lower against the USD from yesterday’s close.
The pair is expected to find support at 1.3155, and a fall through could take it to the next support level of 1.3118. The pair is expected to find its first resistance at 1.3228, and a rise through could take it to the next resistance level of 1.3264.
The currency pair is showing convergence with its 20 Hr moving average and trading above its 50 Hr moving average.