On Monday, the pair showed decline as tensions in markets that Greece might default on its debt obligations endorsed demand on refuges. Greece announced on the weekend that it will not be able to meet its budget deficit target for the current year and revealed in a budget report released on Monday that the economy will witness contraction of 5.5% this year and 2.5% in 2012 while budget deficit is predicted to mushroom to 172.7% of GDP.
The delay of the disbursement of the sixth tranche of last year’s bailout package from October 3 till mid October, until international inspectors write their assessment regarding the Greek commitment to cut deficit on Wednesday, added to worries and thereby enhancing demand on refuges.
The upbeat manufacturing data released on Monday mitigated some of the pair losses but did not overshadow the negative sentiment as the main attention, meanwhile, is directed on the latest developments from the euro area.
U.K. manufacturing witnessed an expansion of 51.1 in Sep. compared with the revised contraction of 49.4 in August, whereas, on the other hand, U.S. ISM manufacturing showed a widening expansion to 51.6 in September from the prior 50.6.
U.K. Chancellor of the Exchequer referred that keeping interest rate at its low level is the best solution to boosting the sluggish growth, where last month the BoE hinted that there could be an expansion in the APF, which is affecting the pound’s movements negatively.
On Tuesday, U.K. PMI construction will be available at 08:30 GMT, with projections referring to an ease in expansion to 51.2 in Sep. compared with the prior reading of 52.6.
As of 14:00 GMT, the U.S. economy will release factory orders report for the month of August, where analysts’ forecasts are in favor of a 0.2% rise compared with the 2.4% advance recorded in July.
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