- UK economy unexpectedly contracted during the second quarter of 2019.
- Dismal UK manufacturing/industrial production data add to the selling bias.
Selling pressure around the British Pound picked up the pace in the last hour and dragged the GBP/USD pair back below the 1.2100 handle, or fresh weekly lows.
The pair failed to capitalize on the previous session’s attempted rebound and met with some fresh supply on the last trading day of the week as investors still seemed reluctant to buy the Sterling amid increasing odds of a no-deal Brexit on the new extended deadline of October 31.
Dismal UK macro data prompts fresh selling
The pair traded with a negative bias for the third consecutive session and the bearish bias intensified further following the disappointing release of UK macro data, showing that the economy unexpectedly contracted by 0.2% during the second quarter of 2019.
Adding to this, the UK manufacturing and industrial production data also missed market expectations by a big margin and further dented the already weaker sentiment surrounding the British Pound, taking along some intraday stops near the 1.2100 handle.
It would now be interesting to see if the pair is able to find some support at lower levels or dismal data-led slide marks a fresh bearish breakdown, paving the way for the resumption of the downward trajectory towards challenging the key 1.20 psychological mark.
Technical levels to watch
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