The sterling slid against the US dollar on Tuesday, despite the fact that official data showed activity in UK construction sector expanded at the fastest pace since May 2012 in the month of June.
GBP/USD pair fell down to 1.5194 at 9:29 GMT, currently the session low. Support was expected at June 28th low, 1.5136, while resistance was likely to be encountered at June 28th high, 1.5239.
Earlier on Tuesday it was reported that Construction CIPS indicator in the United Kingdom came in at 51.0 in June from 50.8 a month ago. Experts had projected a rise to 51.4. This result eased concerns about economic outlook in the country. High production levels were favored by an increased number of new orders, as this led to higher employment levels in construction during the current period. This indicator proved to be another, which could raise the odds of a strong UK economic growth during the second quarter of this year, while prospects of additional easing measures by the Bank of England were off the table for now.
In addition, data on Monday pointed that manufacturing activity in the UK rose at the fastest pace in over two years in June, reaching 52.5, as it was 51.5 in May, according to revised data.
Trade remained subdued as investors awaited Friday’s non-farm payrolls data from the United States, while speculation over FED reducing the scale of its Quantitative Easing soon appeared again. Recent US data on Monday pointed in that direction as well. The Institute for Supply Management reported yesterday, that its manufacturing purchasing managers’ index rose to a reading of 50.9 in June, recovering from a value in the contraction zone (below 50.0) in May.
Pound was on higher levels against the euro, as EUR/GBP cross decreased by 0.16% to 0.8569. The common currency was put under pressure after Euro zone officials said on Tuesday, that Greece had three days to reach an agreement with its lenders, in order to receive the next tranche of its bailout funding.
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