GBP/USD Analysis & Talking Points
- Weak UK Manufacturing PMI Adds to GBP/USD Woes
- Brexit Latest: Rebel MPs Attempting to Block a No-Deal
Weak UK Manufacturing PMI Adds to GBP/USD Woes
Ahead of the UK Manufacturing PMI release, Sterling had been under pressure throughout the European morning. GBP/USD broke below the 1.21 handle amid the ongoing constitutional crisis as MPs returned to parliament. The headline figure dropped to the lowest level since July 2012 at 47.4, below expectations of 48.5. Consequently, GBP/USD continued to languish around intra-day lows of 1.2090, while EUR/GBP has edged towards the 0.91 handle. IHS Markit stated that new orders had fallen to its lowest level in 7 years, while business confidence within the sector had dropped to a record low.
Brexit Latest: Rebel MPs Attempting to Block a No-Deal
As MPs return from the summer recess and as Prime Minister Boris Johnson approved to suspend parliament from mid-September to October 14th. Time is of the essence for rebel MPs in order to attempt to block a no-deal Brexit. Reports this morning have noted that MPs are looking to pass legislation that will force the PM to seek an extension from the EU provided a deal is not reached between the EU and UK before October 31st. However, with Boris Johnson threatening to deselect Conservative rebels, which in turn could see the PM with a minority government, expectations for a snap election is on the rise.
UK Poll of Polls
Source: Politico
GBPUSD PRICE CHART: 1-MINUTE TIME FRAME (INTRADAY September 2, 2019)
For a more in-depth analysis on FX, check out the Q3 FX Forecast
--- Written by Justin McQueen, Market Analyst
To contact Justin, email him at Justin.mcqueen@ig.com
Follow Justin on Twitter @JMcQueenFX
