Forex Pros – The euro jumped to a 13-month high against the pound on Tuesday, after a report showing that manufacturing activity in the U.K. declined more-than-expected in April to hit a seven-month low.
EUR/GBP hit 0.8980 during European morning trade, the pair’s highest since March 30, 2010; the pair subsequently consolidated at 0.8969, jumping 0.74%.
The pair was likely to find support at 0.8854, Monday’s low and resistance at 0.9066, the high of March 17, 2010.
The Markit/CIPS manufacturing purchasing managers’ index fell to 54.6 in April; it’s lowest since September, from a downwardly revised 56.7 in March and well below the expected reading of 56.9.
A reading above 50 indicates that activity increased, while a reading below 50 indicates that it decreased.
Rob Dobson, senior economist at Markit said, “The outlook has deteriorated sharply, with new orders growth having collapsed from a booming pace at the start of the year to only register a weak influx of new business in April”.
The pound was also sharply lower against the U.S. dollar, with GBP/USD tumbling 0.91% to hit 1.6499.
Later Tuesday, the U.S. was to release government data on factory orders.
ForexPros.com
