Markit’s initial PMIs can send sterling even lower and leave it unchanged in the best-case scenario, according to FXStreet’s analyst Yohay Elam.
Key quotes
“Economists expect scores of 45 in both the manufacturing and services sectors. However, these levels are relatively upbeat as they are relatively close to recent lows seen in the manufacturing sector.”
“If the statistics miss expectations, the pound may suffer an instant response to the disappointment. On the other hand, if they beat estimates, the knee-jerk reaction may be positive, but investors may suspect that this is already old news.”
“Perhaps the best outcome for GBP/USD would be hitting projections on the head – staying out of the spotlight. In this case, traders will move onto chasing the next coronavirus-related headlines.”
“Overall, the trend in the cable is to the downside, as the country is going into harsher economic hardship and as the dollar continues benefiting from safe-haven flows.”
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