Talking Points
- Sterling gives back some of last week’s gains after weak manufacturing data.
- UK Manufacturing drops for the third month but remains above long-term average
- See the DailyFX Economic Calendar and see what live coverage for key event risk impacting FX markets is scheduled for next week on the DailyFX Webinar Calendar.
The UK Markit Manufacturing PMI fell for the third consecutive month in March to 54.2 from a downwardly revised 54.5 in February, although the index remained above the long-term average of 51.6.
According to Markit, the manufacturing sector is now on course to contribute less to economic growth in the first quarter compared to the strong 1.3% increase in production seen in the final quarter of last year.
“However, thanks to a strong January, the first quarter could still see reasonable growth of approximately 0.6-7%.”
While today’s numbers are disappointing, the dominant UK services sector report is set for release on Wednesday and will show a clearer picture on the current state of the UK economy.
GBP fell against both USD and EUR on the miss, giving back some of last week’s gains.
Chart: GBPUSD Five-Minute Timeframe (April 3, 2017).
--- Written by Nick Cawley, Analyst
To contact Nick, email him at Nicholas.cawley@ig.com
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