Sterling slides again
GBP/USD is still in the downward trend that began when the better-than-expected core inflation figures from the US set the wheels in motion for the dollar’s bull run. Despite the fact that the UK construction PMI report jumped to a four-month high it couldn’t hold back the strength of the greenback.
At 9.30am (London time) the UK will release the services PMI report for February, and the market is expecting a reading of 57.6 compared with a reading of 57.2 in January. The UK services sector accounts for 78% of the country’s economic output, and should the figure disappoint it could spark short-term selling.
The bias is to the downside and GBP/USD is receiving support at in the $1.5340 region – a move through this level is will make $1.53 the target. A leg above the 50-hour moving average of $1.5372 will bring the resistance at $1.54 into play, and if that level is cleared traders will look to $1.5440.