Fundamentals were largely unfavorable to the Great Britain pound: uncertainty about the outcome of the upcoming general election, the slowdown of the services sector’s growth, and the terrorist attack on London. Yet all that did not prevent the currency from rising on Monday.
The seasonally adjusted IHS Markit/CIPS Services PMI Business Activity Index dropped to 53.8 in May from 55.8 in April, far below the 55.1 reading predicted by analysts, demonstrating the slowest growth of the sector since February. Traders mostly ignored the data, focusing on the election scheduled for June 8. Opinion polls were all over the place, with some promising convincing victory of Prime Minister Theresa May‘s Conservative party, while others showed that the Tories have almost lost the lead in the race and divided parliament is a distinct possibility.
GBP/USD gained from 1.2858 to 1.2913 as of 12:00 GMT today after opening below the Friday’s close of 1.2888. EUR/GBP declined from 0.8759 to 0.8708.
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