GBP/USD (current price: 1.3132)
Cable ended the week on a negative note, below the 1.31 level, as the British economy shows early signs of weakness in the reports that already contain data since the Brexit referendum. The Bank of England pledged to support the economy in the case of a significant slowdown, and Friday’s 47.4reading from the Services PMI, shows that trouble might be ahead. Manufacturing posted a positive surprise, but the segment is relatively small compared to the whole economy.
Our assessment: The Pound continued to trade sideways in a relatively narrow range, but the 1.30 level is getting closer yet again, and the recent releases suggest that another re-test of the crucial level is possible.
