June 1, 2011
Boo hoo! The pound got clobbered by the Greenback yesterday as GBP/USD dropped by almost a hundred pips from a high of 1.6548 to close at 1.6451. Against the yen, the pound performed much better as it ended the day 81 pips higher than its 133.30 open price. How will today's U.K. reports impact the pound?
The U.K. is set to release a bunch of economic data today. First up at 8:30 am GMT is the manufacturing PMI for May, which is expected to dip from 54.6 to 54.2. But don't go hatin' on the pound just yet! Recall that the Royal Wedding took place just before May and it could still have a residual impact on the first couple of weeks of the month. With that, stay on your toes for a possible upside surprise which could boost the pound.
Next is the net lending to individuals report, which could show that new credit issued to consumers more than doubled from 0.5 billion GBP in March to 1.1 billion GBP in April. A higher than expected figure could be bullish for the pound pairs because it would imply that consumers are financially confident enough to swipe their credit cards and take on loans. Watch out for the actual report due 8:30 am GMT.
Also due at that time is the M4 money supply and the mortgage approvals data. Both figures are slated to have minimal impact on the pound's movement but it'd help to keep an eye out for those reports just the same. After all, an increasing money supply could spur inflation, which could lead to an interest rate hike somewhere down the road. Meanwhile, higher mortgage approvals could have a positive effect on future consumer spending.
Last edited by PipDiddy; 05-31-2011 at 10:24 PM.
"The only cable I watch is the pound baby."