UK construction PMI overview
The UK construction PMI for April is due for release today at 0830GMT, with the figure expected to come in a tad weaker at 52.0, when compared to March’s 52.2 reading.
Deviation impact on GBP/USD
Readers can find FX Street’s proprietary deviation impact map of the event below. As observed the reaction is likely to remain confined between 10 and 45 pips in deviations up to 2 to -2, although in some cases, if notable enough, a deviation can fuel movements of up to 70 pips.
How could affect GBP/USD?
A positive surprise in the construction sector activity report would provide much-needed impetus to the GBP bulls, in a bid to push the rate towards 1.30 handle. On the other hand, a bigger-than expected drop in the PMI reading could knock-off the GBP/USD pair below 1.2886/84 (10-DMA/ Apr 28 low), opening doors for a test of 1.2832 (classic S2/ Fib S3).
An upside surprise in the construction sector PMI cannot be ruled out, given yesterday’s solid rebound in the manufacturing PMI report, as the construction PMI has widely shown the similar behaviour as the manufacturing and services PMIs, analysts Societe Generale remarked in a research note.
Cable “was now seen consolidating just below mid-1.2900s as traders now look forward to the release of UK Construction PMI, later during the European session.”
About UK construction PMI
The PMI Construction released by the Chartered Institute of Purchasing & Supply and Markit Economics shows business conditions in the UK construction sector. It is worth noting that the construction sector does not influence, either positively or negatively, the GDP as much as the Manufacturing sector does A result that values above 50 signals appreciates (or is bullish for) the GBP, whereas a result that values below 50 is seen as negative (or bearish).