Investing.com – The pound closed lower against the U.S. dollar last week after a string of worse-than-expected U.K. data underlined the view that the Bank of England is likely to keep interest rates low for some months to come.
GBP/USD hit 1.6286 on Friday, the pair’s lowest since May 26; the pair subsequently consolidated at 1.6422 by close of trade, shedding 0.38% over the week.
Cable is likely to find support at 1.6272, the low of May 26 and resistance at 1.6494, the high of June 1.
The pound fell sharply on Wednesday after official data showed that manufacturing activity in the U.K. grew at its slowest rate in 20 months in May.
The worst reading since September 2009 was blamed on a weaker domestic market, particularly for consumer goods, and the slowest growth in export orders in eight months. Extra public holidays also reduced activity.
Meanwhile, on Thursday, BoE policymaker Paul Fisher said that he might back more quantitative easing if the economy took a sudden downturn.
On Friday, the U.S. Department of Labor said nonfarm payrolls rose much less-than-expected in May, increasing by just 54K as the private sector posted the smallest jobs gain in nearly a year. Analysts had expected nonfarm payrolls to rise by 169K last month. The unemployment rate unexpectedly rose to 9.1% from 9.0% in April.
But the pound clawed back the day’s losses after the European Union, the European Central Bank and the International Monetary Fund said the next tranche of international aid for Greece should be available in July.
The BoE is to hold its rate setting meeting next week with the bank widely expected to keep rates on hold. Elsewhere, Federal Reserve Chairman Ben Bernanke is to speak.
Ahead of the coming week, Investing.com has compiled a list of these and other significant events likely to affect the markets. The guide skips Monday as there are no relevant events on this day.
Tuesday, June 7
The U.S. is to publish official data on consumer credit, which is correlated with consumer confidence and spending. Also Tuesday, Federal Reserve Chairman Ben Bernanke is to speak; his comments will be closely watched for any clues to the future possible direction of monetary policy.
Wednesday, June 8
the U.S. is to publish official data on crude oil inventories while the Federal Reserve is to publish its Beige Book, which gives insights into the data policymakers looked at when making their most recent interest rate decision.
Thursday, June 9
The U.K. is to release official data on the trade balance, the difference in value between imported and exported goods and services. Later in the day, the BoE is to announce its official cash rate.
Also Thursday, the U.S. is to publish its trade balance and its weekly report on initial jobless claims.
Friday, June 10
The U.K. is to publish official data on manufacturing production, a leading indicator of economic health. The country is also to publish official data on industrial production and producer price inflation input. Also Friday, the BoE is to release a report on consumer inflation expectations.
Later in the day, the U.K. National Institute of Economic and Social Research is to publish its estimate of second quarter gross domestic product, in an effort to predict government compiled data.
The U.S. is to round up the week with official data on import prices, which contribute to overall inflation, while the Federal Reserve is to publish a report on the federal budget balance.
GBP/USD hit 1.6286 on Friday, the pair’s lowest since May 26; the pair subsequently consolidated at 1.6422 by close of trade, shedding 0.38% over the week.
Cable is likely to find support at 1.6272, the low of May 26 and resistance at 1.6494, the high of June 1.
The pound fell sharply on Wednesday after official data showed that manufacturing activity in the U.K. grew at its slowest rate in 20 months in May.
The worst reading since September 2009 was blamed on a weaker domestic market, particularly for consumer goods, and the slowest growth in export orders in eight months. Extra public holidays also reduced activity.
Meanwhile, on Thursday, BoE policymaker Paul Fisher said that he might back more quantitative easing if the economy took a sudden downturn.
On Friday, the U.S. Department of Labor said nonfarm payrolls rose much less-than-expected in May, increasing by just 54K as the private sector posted the smallest jobs gain in nearly a year. Analysts had expected nonfarm payrolls to rise by 169K last month. The unemployment rate unexpectedly rose to 9.1% from 9.0% in April.
But the pound clawed back the day’s losses after the European Union, the European Central Bank and the International Monetary Fund said the next tranche of international aid for Greece should be available in July.
The BoE is to hold its rate setting meeting next week with the bank widely expected to keep rates on hold. Elsewhere, Federal Reserve Chairman Ben Bernanke is to speak.
Ahead of the coming week, Investing.com has compiled a list of these and other significant events likely to affect the markets. The guide skips Monday as there are no relevant events on this day.
Tuesday, June 7
The U.S. is to publish official data on consumer credit, which is correlated with consumer confidence and spending. Also Tuesday, Federal Reserve Chairman Ben Bernanke is to speak; his comments will be closely watched for any clues to the future possible direction of monetary policy.
Wednesday, June 8
the U.S. is to publish official data on crude oil inventories while the Federal Reserve is to publish its Beige Book, which gives insights into the data policymakers looked at when making their most recent interest rate decision.
Thursday, June 9
The U.K. is to release official data on the trade balance, the difference in value between imported and exported goods and services. Later in the day, the BoE is to announce its official cash rate.
Also Thursday, the U.S. is to publish its trade balance and its weekly report on initial jobless claims.
Friday, June 10
The U.K. is to publish official data on manufacturing production, a leading indicator of economic health. The country is also to publish official data on industrial production and producer price inflation input. Also Friday, the BoE is to release a report on consumer inflation expectations.
Later in the day, the U.K. National Institute of Economic and Social Research is to publish its estimate of second quarter gross domestic product, in an effort to predict government compiled data.
The U.S. is to round up the week with official data on import prices, which contribute to overall inflation, while the Federal Reserve is to publish a report on the federal budget balance.