Gains Forecast For Pound Dollar Exchange Rate If UK Construction Data Is Positive

Modified: Wednesday, 2 October 2013 10:08 BST - Written by David Woodsmith

STORY LINK Gains Forecast For Pound Dollar Exchange Rate If UK Construction Data Is Positive

A failure to reach a debt deal in the US sent the GBP USD exchange rate higher yesterday. However, Sterling was anchored by a weaker than anticipated UK data set.

The Pound US Dollar exchange rate (GBP/USD) is currently trading up by 0.07% at 1.6198 GBP/USD. The US Dollar Pound exchange rate is currently trading at 0.6174 USD/GBP.

The US debt deadline of midnight on 30th September passed without Democrat and Republican factions reaching a deal on the nation’s Federal budget. Surprisingly, however, the world continued turning. This fact was reflected in yesterday’s movement in US share markets where the broad-ranging S&P 500 was trading up by almost 1% during the latter stages of yesterday’s session.

The lack of an accord between warring political factions in the States followed the Democrats’ refusal to accept the delay of the introduction of the ‘Obamacare’ healthcare reforms as a condition of passing the proposed spending plan. The development meant that a partial shutdown of US government services took place yesterday, meaning that 700,000 American workers were told to stay away from work. The news did serve to send the Pound US Dollar exchange rate to the top end of its 2013 range. Cable touched 1.6260 during early trading in Europe.

Gains for GBP USD would have been greater on the day were it not for a disappointing PMI sector survey which showed that activity levels in Britain’s manufacturing sector had increased fro the sixth month on the trot last month, but that the move higher was not by as much as analysts had been anticipating. Look for this morning’s UK PMI Construction sector survey to break the 60.0 threshold for the Pound to push higher again against the Greenback. The next significant technical level to the upside for GBP USD comes at the key psychological threshold of 1.6500.

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