GBPUSD Movement
For the 24 hours to 23:00 GMT, GBP fell 0.15% against the USD and closed at 1.6198, after construction sector activity in the UK expanded at a slower pace in April. A separate report by the Bank of England showed that net lending to individuals rose by £1.4 billion in March, below expectations for a £1.5 billion rise and following a £1.3 billion increase the previous month.
In the UK, the construction purchasing managers’ index (PMI) fell to a reading of 55.8 in April, compared to 56.7 in March. Meanwhile, the Bank of England reported that number of mortgages approved in March totaled 49,860, compared to 49,029 approvals in February. Total lending to individuals rose £1.4 billion on a monthly basis in March, compared to £1.3 billion increase in February. Consumer credit rose £0.4 billion in March, compared to a revised £0.3 billion in February. A separate report showed that M4 money supply dropped 5.0% annually in March compared to a 4.1% fall in February.
Meanwhile, Bank of England (BoE) Governor, Mervyn King, has stated that inflation in Britain is too high and the nation’s economic recovery is slower-than-expected. He further mentioned that the central bank is prepared to take stern measures to foster banking reforms and economic growth.
Additionally, the Confederation of British Industry (CBI) lowered its economic growth forecast for the year to 0.6% from the previously projected 0.9% growth and has cautioned that the UK’s economy is facing a long and difficult recovery.
In the Asian session, at GMT0300, the pair is trading at 1.6184, with the GBP trading 0.08% lower from yesterday’s close.
The pair is expected to find support at 1.6150, and a fall through could take it to the next support level of 1.6116. The pair is expected to find its first resistance at 1.6228, and a rise through could take it to the next resistance level of 1.6273.
Trading trends in the pair today are expected to be determined by release of nationwide housing prices and services purchasing manager index in the UK.
The currency pair is trading below its 20 Hr and 50 Hr moving averages.
