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GBP/USD drifting in thin holiday trade

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The British pound is showing limited movement on Monday. With US markets closed for labor day, we’re unlikely to see much movement from the US dollar. In the North American session, GBP/USD is trading at 1.3147, up 0.16% on the day.

UK manufacturing shows slight expansion

The UK Manufacturing PMI remained unchanged in August at 52.5, in line with expectations. This was the highest level in 26 months, as the manufacturing sector continues to recover with the PMI indicating expansion in four of past five months.

The UK will release the Services PMI on Wednesday, with the August reading expected to accelerate to 53.3, up from 52.5 in July. The Bank of England delivered an initial rate cut in August and is looking to continue cutting, which will boost economic activity.

We’ll get  a look at US manufacturing on Tuesday. The US has been not immune to the woes of the global manufacturing sector and Tuesday’s ISM Manufacturing PMI is expected to point to contraction. The PMI has posted only one month of expansion since October 2022, although the markets are expecting the PMI to improve to 47.5 for August, up from 46.8 in the previous release.

GBP/USD Technical

  •  GBP/USD tested resistance at 1.3145 earlier. Above, there is resistance at 1.3181
  • 1.3091 and 1.3055 are providing support

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Kenny Fisher

Kenny Fisher

Market Analyst at OANDA
A highly experienced financial market analyst with a focus on fundamental and macroeconomic analysis, Kenny Fisher’s daily commentary covers a broad range of markets including forex, equities and commodities. His work has been published in major online financial publications including Investing.com, Seeking Alpha and FXStreet. Kenny has been a MarketPulse contributor since 2012.
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