Markit’s UK services PMI scored 58.3 points in January. The UK was expected to see a minor rise from 58.8 to 59.1 points in the services purchasing managers’ index. The services sector is by far the largest in the UK. The construction sector is at very strong levels, while the manufacturing one is doing OK.
GBP/USD was sliding towards the publication, losing the 1.63 handle. The pound remains on lower ground after the news.
Update: GBP/USD is actually digging lower. This is not the classic case of “buy the rumor, sell the factâ€, but actually an extension, even though the negative surprise was not that big. 58.3 still represents solid growth.
It seems that traders are looking for reasons to sell the pound.
At 64.6 points, the construction sector is at its strongest in nearly 6.5 years. Strong growth may be good, but also causes worries about another housing bubble and another run of housing without the rest of the economy.
1.6260 provides support and 1.6340 works as resistance. For more, see the GBP to USD forecast.
