When is the UK construction PMI and how could it affect GBP/USD?
The UK construction PMI overview
The UK construction PMI for December is due for release today at 0930GMT, with the figure expected to come in at 52.9, down from November’s 53.4 reading.
Deviation impact on GBP/USD
Readers can find FX Street's proprietary deviation impact map of the event below. As observed the reaction is likely to remain confined between 10 and 45 pips in deviations up to 2 to -2, although in some cases, if notable enough, a deviation can fuel movements of up to 70 pips.
How could affect GBP/USD?
Technically, the pair looks to extend its consolidative mode near 1.2550 levels. On a positive surprise, a break higher towards the 1.26 handle could be seen. A sustained move above the last could see a test of 1.2620 inevitable (near-term resistance). On the flip side, a break below 1.2500 (round number), GBP/USD could retest 1.2438 (early Thursday flash crash low) en route 1.2366 (April 2017 lows).
A better UK construction PMI report cannot be ruled today, given Monday’s stellar manufacturing PMI numbers. The construction PMI has widely shown the similar behavior as the manufacturing and services PMIs, analysts Societe Generale pointed out in a research note. However, the reaction in the GBP is more likely to be driven by the risk trends amid intensifying global slowdown fears.
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About the UK construction PMI
The PMI Construction released by the Chartered Institute of Purchasing & Supply and Markit Economics shows business conditions in the UK construction sector. It is worth noting that the construction sector does not influence, either positively or negatively, the GDP as much as the Manufacturing sector does. A result that values above 50 signals appreciates (or is bullish for) the GBP, whereas a result that values below 50 is seen as negative (or bearish).