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GBP/USD almost unchanged after U.K. PMI report

The pound was almost unchanged against the U.S. dollar on Friday, despite the release of upbeat U.K. manufacturing data as uncertainty following the Brexit vote and news of a potential U.K. rate cut this summer limited sterling’s gains.

GBP/USD hit 1.3350 during European morning trade, the session high; the pair subsequently consolidated at 1.3315.

Cable was likely to find support at 1.3318, the low of June 27 and resistance at 1.3535, the high of June 29.

Research group Markit said that its U.K. manufacturing purchasing manager’s index rose to 52.1 last month from a reading of 50.1 in May. That was its highest level since January 2016.

Analysts had expected the index to drop back into contraction at 49.9 in May.

But the pound remained under pressure as markets were still recovering from Britain’s shock decision last week to leave the European Union.

Bank of England Governor, Mark Carney, indicated on Thursday that more stimulus may be needed over the summer, sparking expectations for an upcoming rate cut.

Sentiment also weakened after downbeat Chinese manufacturing data sparked fresh concerns over a slowdown in the world’s second largest economy.

Data on Friday showed that China’s Caixin manufacturing PMI fell to 48.6 in June from 49.2 the previous month, compared to expectations for a downtick to 49.1.

At the same time, China’s official manufacturing PMI came in at 50.0 last month from 50.1 in May, in line with expectations.

Sterling was also steady against the euro, with EUR/GBP at 0.8339.



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