UK POUND SEES MILD RECOVERY FROM NEAR 2-MONTH LOW ON IMPROVING PMI DATA

Published on Apr 02, 2024 15:49

UK pound recovered some lost ground from a near two month low and climbed higher against the dollar during European session on Tuesday on the back of improved economic data. UK manufacturing sector showed tentative signs of recovery in March, as output and new orders increased following year-long downturns. The seasonally adjusted S&P Global UK Manufacturing Purchasing Managers� Index (PMI) rose to a 20-month high of 50.3 in March, up from 47.5 in February and above the earlier flash estimate of 49.9. This was the first time the PMI has posted above the neutral 50.0 mark since July 2022. GBPUSD futures rebounded to $1.2573, up 0.22% on the day after having dipped to a near 2-month low of $1.2543. Meanwhile, broad strength in US dollar index futures overseas also weighed on the pair since last few days. The dollar index futures that measure the greenback against a basket of currencies raced to 104.72 after US ISM business activity report from March yesterday reported highest growth since September 2022, showing resilience in US economy that could deter the Fed from rushing into rate cuts. US 10-year benchmark treasury yields shot up to 4.35%. On the NSE, GBPINR futures were trading at 104.93, down 0.378% on the day.