Another week, another set of losses! Sterling just couldn’t shake off bearish vibes from Brexit uncertainty, and this week’s events don’t seem promising.
U.K. PMI readings (starting June 3, 8:30 am GMT)
It’s the start of a brand-new month, and y’all know what that means: a fresh batch of U.K. PMIs!
The manufacturing sector will get the ball rolling by releasing their numbers on Monday’s London session. Analysts are expecting to see a drop from 53.1 to 52.5 to reflect a slower pace of industry growth in May.
The construction PMI due the following day doesn’t normally spur a huge reaction, but it might still be helpful to check if this sector is also in slowdown mode. The consensus is for a slight improvement from 50.5 to 50.6, though.
Lastly, the services PMI is due on Wednesday’s London session and might show an improvement from 50.4 to 50.6, reflecting a faster pace of expansion in the industry.
BOE Governor Carney’s speech (June 6, 9:00 am GMT)
Head honcho Carney is scheduled to speak at the Institute of International Finance Spring Meeting in Tokyo and would be taking questions from the audience.He is likely to be asked about Brexit developments and how these impact BOE policy. In his earlier testimony, Carney mentioned that investors might be underestimating the possibility of an interest rate hike… but this was waaay before PM May stepped down.
Shifting to a more cautious tone could drag sterling further south, especially if Carney highlights economic projections related to a “no deal” Brexit.
BOE Deputy Governor Ramsden, who has a testimony scheduled the previous day, has already cautioned that this scenario might be the biggest risk to the U.K. economy.
Missed last week’s price action? Read GBP’s price recap for May 27-31!