By FX Empire.com
The pair slipped after lackluster report from the U.K. showing that U.K. mortgage approvals fell in September to 51,000 from 52,300 a month earlier.
Still, the outlook for the British economy is worrying; noting that the latest announcements by BoE policymakers revealed that the economy could witness another contraction or recession in the coming quarters and the BoE may add further to stimulus after the current round is completed.
Moreover, the pair was affected by the general sentiment which was fueled by skeptics regarding the implementation of the measures announced by European leaders last week.
Investors are keeping an eye lid on any details concerning the debt deal, where further details may divulged in the coming European finance minister’s meeting on November 7-8.
Also, eyes will be on the G-20 leaders as they meet in Cannes, France, on Nov. 3-4 to continue their discussions on the repercussions of the financial crisis on global markets. Gurria said world leaders should coordinate their efforts and policies to pass the current hurdle phase which is surrounded with uncertainties.
The dollar, on the flip side, was boosted against major currencies after the BoJ’s third intervention this year which took place on Monday. Amid interventions from central banks, concerns increase that world economies need a boost and thereby things are not going well.
On Tuesday, the British economy will release important data starting with nationwide house prices for October, yet more focus will be at U.K. PMI manufacturing for Oct., due at 09:30 GMT, which is expected to show an ease in expansion to 50.0 from the 51.1 recorded in September. However, the main highlight of the day will be GDP advanced figures for the third quarter due at 09:30 GMT. The data may show that the U.K. expanded 0.3% in the third quarter compared with the 0.1% expansion in the second quarter, while on the annual basis the reading will record an expansion of 0.3 from the prior 0.6%.
For the U.S., the main focus will be on ISM manufacturing for Oct., as of 14:00 GMT, which is predicted to show a widening expansion to 52.3 from 51.6 in September.
Fundamentals from both economies is expected to have an impact on the pair’s movements as investors are now concentrating on the latest development in main sectors to see whether there is improvement in the fourth quarter after the sluggish growth pace which encountered global economies.
