Search ForexCrunch

Manufacturing production in the UK fell by 1.1%, worse than 0.6% that was expected. The wider industrial output figure fell 0.6% as expected.  

GBP/USD fell to support at 1.60 but didn’t follow through.

GBP/USD already lost the 1.6060 line earlier in the week. Looking at the bigger picture, pound/dollar failed to break above 1.63, and continued deteriorating since then.

The round number of 1.60 was initially challenged as worries about Europe grew: Spain moved a bit away from asking for a bailout: this hurt Spanish bonds, European stock markets and the euro.

In addition, the UK reported the trade balance number, which also disappointed by printing a wider deficit of 9.8 billion pounds, worse than 8.3 billion that was predicted and much wider than last month’s 7.3 billion deficit.

For more on the pound, see the GBPUSD forecast.

In general, British indicators were quite mediocre, and there’s still a lot of talk about a Plan B to the government’s austerity measures.