British Construction PMI Index is based on a survey of Purchasing Managers in the construction industry. The survey includes about 170 respondents, who are surveyed for their view of a wide range of business conditions, including employment, new orders, prices and inventories. A reading which is higher than the market forecast is bullish for the pound.
Here are all the details, and 5 possible outcomes for GBP/USD.
Published on Tuesday at 8:30 GMT.
Indicator Background
The UK Construction PMI has been losing ground in recent readings, and slipped to 54.2 points in April, well off the estimate of 57.6 points. The markets are expecting better news in the May report, with an estimate 55.1 points.
Sentiments and levels
The US dollar is on an impressive roll against its major rivals, and could continue its upward movement this week against the struggling pound. With analysts expecting better news in Q2 after a disappointing Q1, we could see the pair continue its downward move towards the symbolic 1.50 level. Thus the overall sentiment continues to be bearish on GBP/USD towards this release.
Technical levels, from top to bottom: 1.5485, 1.5350, 1.5270, 1.5127, 1.5008 and 1.4911.
5 Scenarios
- Within expectations: 52.0 to 58.0: In such a case, GBP/USD is likely to rise within range, with a small chance of breaking higher.
- Above expectations: 58.1 to 61.0: An unexpected higher reading can send the pair well above one resistance line.
- Well above expectations: Above 61.0. The likelihood of a sharp expansion is low. Such an outcome could prop up the GBP/USD, and a second resistance line might be broken as a result.
- Below expectations: 48.0 to 51.9: A weak reading could send the pair below one resistance line.
- Well below expectations: Below 48.0: GBP/USD would likely lose ground in this scenario, and the pair could break below a second support level.
For more about the GBP, see the GBP/USD.
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