The Pound Sterling, which had been under pressure prior to the latest policy decision from the Bank of England, continued its slide, falling to a 1-month trough versus the US Dollar. The last “holdout” from the Bank of England’s hawk’s camp, Ian McCafferty, told one news outlet that if the latest data confirmed that the UK economy was not bouncing back after the Brexit vote, the Monetary Policy Committee would have no option but to provide more liquidity. On a “brighter note,” Mr. McCafferty did say that thus far there was only limited information on the economic downturn, leaving some room for optimism for some FX investors.
As reported at 10:55 am (BST) in London, the GBP/USD was trading lower at $1.2976, down 0.49%; the pair has ranged from a session trough of $1.2965 to a peak of $1.3050. The EUR/GBP was 0.52% higher at 0.8546 Pence; the pair ranged from a low of 0.8486 Pence to a peak of 0.8540 Pence.
UK Manufacturing Data Disappoints
Last night’s release of UK retail sales figures were more upbeat than expected, however today’s economic news is less favorable. Manufacturing production for June missed expectations both on a monthly and quarterly basis; as manufacturing production is a large component of the UK’s GDP the data suggests that growth could also be a miss for the month which would further weigh on the Pound Sterling.