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British Manufacturing Production Dives by 0.7%, GBP/USD Down

British Manufacturing production fell by 0.7%. Early expectations stood on a small drop of only 0.1%. The wider figure of industrial production also fell by 0.7%, more than 0.3% that was expected.

Pound/dollar is ticking down after the publication, getting closer to 1.5633. GBP/USD floated around the 1.5633 line prior to the release, climbing up from lows seen yesterday. Support is found 1.5550. Serious resistance is at 1.5780.

For more levels, see the British pound forecast.

This drop in manufacturing joins the negative manufacturing PMIs seen in recent months. Purchasing managers’ indices have shown that  manufacturing  is contracting, while other sectors continue growing. While a drop was expected, it was expected to be smaller this time.

Earlier this week, services PMI exceeded expectations and continued showing nice growth. On the other hand, the BRC retail sales monitor dropped by 1.6%, reflecting a slowdown among consumers.

Tomorrow, the British Monetary Policy Committee will meet for its monthly rate decision. No change in policy is expected, yet some analysts see an expansion of the Asset Purchase Facility program – more pound printing.

Yohay Elam

Yohay Elam

Yohay Elam: Founder, Writer and Editor I have been into forex trading for over 5 years, and I share the experience that I have and the knowledge that I've accumulated. After taking a short course about forex. Like many forex traders, I've earned a significant share of my knowledge the hard way. Macroeconomics, the impact of news on the ever-moving currency markets and trading psychology have always fascinated me. Before founding Forex Crunch, I've worked as a programmer in various hi-tech companies. I have a B. Sc. in Computer Science from Ben Gurion University. Given this background, forex software has a relatively bigger share in the posts.