© Dukascopy Bank SA
The Pound managed to rebound from the previous week however, was affected by Bank of England report and Friday's extra strong US nonfarm payrolls. The Sterling climbed to the day's highs on Monday after data showing that UK manufacturing activity expanded at the fastest rate in 16 months in October, bolstering the outlook for fourth quarter growth. The UK manufacturing purchasing managers' index jumped to 55.5 points last month from 51.8 points in September. Meanwhile, economists had expected the index to tick down to 51.3. The next day, the Cable remained almost unchanged due to the data showing that the UK construction sector posted another month of solid growth in October. The index ticked down to 58.8 last month from 59.9 in September, matching economists' forecasts. On Wednesday, the pair continued its bullish tendency, as UK service sector rebounded last month, but gains were held in check as the Dollar remained firm ahead of Friday's US jobs report. Nevertheless, the Pound extended losses on Thursday, falling more than 1% after a dovish Bank of England quarterly inflation report signaled that interest rates are likely to remain on hold for an extended period. Moreover, on Friday, as another currencies, Sterling dropped to seven-month lows as far stronger than expected US jobs report reinforced expectations for a rate hike by the Federal Reserve next month.
Meanwhile, this week sentiment among Dukascopy traders has significantly strengthened, as now 68% of traders predict the Pound to lose value, while last week this scenario was suggested by 28% of Community members. Meanwhile, on Wednesday, UK is going to announce the monthly employment report, while the Bank of England Governor Mark Carney is to hold a press conference about the quarterly inflation report. The US is to round up the week with data on retail sales and producer prices.
© Dukascopy Bank SA