- UK political optimism continues to underpin the British Pound.
- UK manufacturing PMI jumps to six-month highs of 49.6 in Oct.
- Friday’s key focus will remain on the US monthly jobs report.
The GBP/USD pair held on to its mildly positive tone through the early European session on Friday and had a rather muted reaction to the latest UK macro data.
The pair built on this week’s rebound from the 1.2800 neighbourhood and edged higher for the fifth consecutive session on Friday, albeit lacked any strong bullish conviction. The British Pound remained supported by the incoming opinion polls, which have been indicating a majority for the UK Prime Minister Boris Johnson’s Conservative Party at the upcoming election in December.
Upbeat UK PMI failed to impress bulls
This coupled with the prevalent US Dollar selling bias, despite the Fed’s indications that further monetary easing is unlikely, remained supportive of the pair’s uptick, albeit lacked any strong bullish conviction. The fact that the actual outcome of the UK snap election could be surprising held investors from placing any aggressive bullish bets and kept a lid on any strong follow-through momentum.
The pair remained capped below the key 1.3000 psychological mark and moved little following the release of better-than-expected UK manufacturing PMI, which unexpectedly jumped to a six-month high level of 49.6 in October. The reading was well above four-month highs of 48.3 recorded in September and surpassed consensus estimates pointing to a reading of 48.1, though failed to impress bullish traders.
Moreover, investors preferred to stay on the sidelines heading into Friday’s release of the closely watched US monthly jobs report, which could also be seen as one of the key factors that collaborated to the pair’s subdued trading action on the last day of the week.
Technical levels to watch
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