BOE Must Love Today’s UK Data, Watch Out For A Dovish BOE
Skerdian Meta • 1 min read
Early this morning we posted an update on our trading feed about the economic numbers from the UK (which were due to be released this morning) and about the BOE (Bank of England) meeting today.
Well, the economic figures from the UK were released and that part of the economic calendar is painted red which is bad, really bad.
Manufacturing contracted by 0.6% in April, twice as much as was expected and the previous month was revised lower too.
The UK trade deficit increased by nearly 2 billion Pound, construction output declined by 0.7%, and industrial production shrank by 0.5%.
Last month was pretty decent regarding UK PMI economic data; services and manufacturing beat expectations, but these are some really horrible numbers.
The analysts jumped on the wires shortly after the release blaming Brexit, which seems accurate, because energy production accounted for most of the industrial output decline.
The Pound is feeling the heat and it is now more than 100 pips lower than yesterday´s highs. I mentioned in the previous GBP update that GBP/USD was looking like it wanted to turn down, since it couldn´t break 1.30. I was expecting the BOE to be happily dovish or at least not hawkish.
So, I wanted to sell this forex pair, but it didn´t get anywhere close to 1.30 today where the risk/reward for a sell forex signal was tempting.
Although, we do have a slight chance if we see a spike before or during the BOE meeting which is already underway, so be ready.