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Soft UK Production Growth Weighs on GBP/USD

UK Industrial production in June grew 0.3% from June when it fell 0.6%. Economists called for a reading around 0.6%. Manufacturing production also came in at 0.3% after a -1.3% print in May. Economists called for a reading around 0.7%.

(source: Office of National Statistics)

The softer production data indicates that the strong GBP and problems in the Euro Area is giving the economic recovery headwinds, and makes a 2014 rate hike less likely. The sterling fell after the production release.
GBP/USD 1H Chart:
GBP/USD has been trying to consolidate since Aug. 1 after a decline from 1.7190, high on the year, to 1.6809, last week's low. After a mini-correction to 1.6888, GBP/USD drifted sideways. Then after the production release, it fell almost back to the common lows in the 1.6810-20 area. 
The market is setting up a range ahead of the Bank of England's monetary policy statement due tomorrow. The bank has started the 2-day meeting today. A break above 1.6888 opens up the 1.6950 and 1.70 level for a short-term bullish correction scenario. A break below 1.68 exposes the 1.67 lows from May-June in the medium-term bearish continuation scenario.