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A Triple Whammy of Positive Economic News

Another day of good economic data sees the momentum provided by yesterday's Services PMI release continue.

Today we got a further dose of good economic news which afforded GBP support:

  1. Manufacturing Production m/m, Jun Figure released at 1.9, Forecast: 0.9, Prev: -0.8
  2. Manufacturing Production y/y, Jun Figure released at 2, Forecast: 0.9, Prev: -2.9,
  3. Industrial Output y/y, Jun Figure released at 1.2, Forecast: 0.7, Prev: -2.3
    best pound dollar rate
  4. Industrial Output m/m, Jun Figure released at 1.1, Forecast: 0.6, Prev: 0
  5. Halifax, the UK's biggest mortgage lender, reported a 0.9 pct jump in house prices in July
  6. The Society of Motor Manufacturers and Traders, the trade body for the UK automotive industry, raised its growth forecast for 2013 following figures for July showing that 162,228 vehicles were sold during the month, a rise of more than 12% on July 2012 and the 17th successive monthly increase.

The outlook for the British Pound versus US dollar exchange rate

  • Boris Schlossberg at BK Asset Management says the GBP is likely to maintain the upper hand:

"UK economic data has now notched an impressive string of upside surprises as all key sectors - services, manufacturing and construction are expanding well above consensus expectations.

"The positive news is finally translating into gains for the pound which spiked to a high of 1.5393 in the aftermath of the release. For the time being the pair continues to find stiff resistance at the 1.5400 figure, but if it can clear that level it opens up the path towards 1.5700 over the next several weeks."

  • Luc Luyet at MIG Bank says:

"GBP/USD remains bouyant and is expected to test the recent 1.5435 high (26/07/2013) over coming sessions.

"Should this take place, it will suggest that the rise off the annual low at 1.4814 is part of a lengthy consolidation pattern/recovery higher.

"A sustained move above 1.5435 will target the 200 day moving average, currently at 1.5542, where we would expect to see a fair amount of resistance."

  • Sean Lee at FXWW says he continues to favour the upside in the British pound / US dollar exchange rate saying:

"The GBP is looking stronger on the crosses after yesterday’s strong (and leaked) PMI data. EUR/GBP is edging back towards it’s important pivot at .8600 and GBP/AUD made fresh highs above 1.7250.

"It’s by no means a completely bullish picture on the crosses, with GBP/JPY still being capped below 151.50 (which is where macro funds were noted sellers last week).

"Nevertheless I remain very bullish on cable and have taken a very small long position at 1.5350. My last attempt at building a long position ended in tears, lets hope for better luck this time."

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