GBP/USD Continues Rise as Pound Recovers
GBP/USD continues its second straight day of gains, starting the new trading week with a seven-tenths of a percent gain and dragging bids back above the 1.2500 level after last week’s bearish slide below 1.2400. Purchasing Managers’ Index (PMI) figures missed the mark in both the UK and US. However, the general environment of improving risk appetite kept the safe-haven flows into the greenback in check.
UK PMI figures for December missed the mark altogether, printing below Wall Street estimates and falling back but remaining above the 50.0 threshold for contraction expectations. The Composite PMI in particular fell to a 13-month low, dropping to 50.4 from the expected 50.5.
The final US S&P Global PMI figures missed the mark somewhat on Monday, with the Composite and Services PMIs for December both rising month-on-month, albeit less than analysts had expected. Both indicators were slightly revised down from their preliminary readings, but still firmed as the US economy continues to grind to a halt.
The main outcome for the midweek window is the US ISM Services PMI for December on Tuesday. Market forecasts are for a rise to 53.0 from 52.1 the previous month. Friday’s Nonfarm Payrolls (NFP) result will loom large over markets this week as investors anticipate a result that will help push the Federal Reserve (Fed) toward further interest rate cuts, but not too weak or strong on either side.
Source: FXStreet
