Manufacturing production in the UK dropped by 0.2%. It was expected to remain flat in April after rising 1.1% in March (before revisions). The wider industrial output figure exceeded expectations by rising 0.1% instead of dropping by 0.4% It rose 0.7% last time.
GBP/USD slid lower towards the release, trading at around 1.5555, down from near 1.56. Cable is marginally lower after the publication. While the main figure disappointed, the surprise isn’t that big.
Later in the day, the NIESR institute will release its GDP estimate for the three months ending in May. This will shed more light on the economy.
All in all, the British pound has shown resilience lately, and it has some good reasons to do so: purchasing managers’ indices have exceeded expectations. There is now a lower chance that Britain will return to a recession.
For more events and analysis, see the GBP to USD forecast.
