After a modest revision, the UK final August Services and Composite PMI data have been increased to 53.7 and 53.8 respectively. According to Scotiabank’s Chief FX Strategist Shaun Osborne, the details of the data were constructive, indicating improved sentiment that is boosting spending and hiring. While this stronger economic momentum may not deter BoE rate cuts, the easing process is expected to be slower compared to other major central bank peers. As a result, Sterling remains virtually unchanged in today’s session.
Analysis of the charts reveals a potential narrow, inside range developing on the daily chart for GBP. Additionally, the intraday chart suggests that the pound is attempting to break above the short-term bear trend at 1.3105 from last week’s high for Cable. A successful break above 1.3155 would further enhance near-term momentum for the pound, with support levels at 1.3090/00.
Overall, the revised PMI data and positive economic indicators are propelling the GBP into a consolidation phase, showing signs of potential growth and stability in the near future. Investors and traders should closely monitor these developments to make informed decisions about their financial strategies and positions in the market.
