When is the UK manufacturing PMI and how could it affect GBP/USD?

The UK manufacturing PMI overview

The UK manufacturing PMI is due for release today at 0830GMT and is expected to show that the pace of contraction in the activity accelerated further in June after reaching thirty-four-month lows in May. The index is expected to arrive at 49.4 versus 49.4 booked previously.

Deviation impact on GBP/USD

Readers can find FX Street's proprietary deviation impact map of the event below. As observed the reaction is likely to remain confined between 10 and 50 pips in deviations up to 1.65 to -2.50, although in some cases, if notable enough, a deviation can fuel movements of up to 80 pips.

How could affect GBP/USD?

At daily lows near 1.2670, the pair looks to extends the slide towards 1.2650 psychological level amid strengthening US dollar demand across the board, as the GBP markets eagerly await the UK data for fresh trading impetus.

Should the data show a sharper-than-expected contraction, the selling pressure could intensify, drowning the spot further towards 1.2600 (round number), below which 1.2506 (5-month lows) could be targeted.

However, on a positive surprise, the GBP/USD pair could stall its declines and attempt a tepid bounce to 1.2685 (5-DMA), above which 1.2706 (10-DMA) could be tested en route 1.2746 (50-DMA).

Key Notes

UK and Eurozone manufacturing PMIs amongst market movers today – Danske Bank

GBP Futures: neutral/bearish in the short term

GBP/USD forecast: Bearish bias remains amid no-deal Brexit fears, UK/US data eyed for some impetus

About the UK manufacturing PMI

The Manufacturing Purchasing Managers Index (PMI) released by both the Chartered Institute of Purchasing & Supply and the Markit Economics captures business conditions in the manufacturing sector. As the manufacturing sector dominates a large part of total GDP, the Manufacturing PMI is an important indicator of business conditions and the overall economic condition in the UK. A result above 50 signals is bullish for the GBP, whereas a result below 50 is seen as bearish.