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Subsequent to having dropped toward 1.1900 in the midst of reestablished dollar strength in the early European meeting, GBP/USD has organized a bounce back. The close term specialized standpoint, notwithstanding, doesn’t yet highlight a bullish slant and dealers could make a move in the event that the pair falls underneath 1.1920.

The negative shift saw in risk opinion assisted the dollar with get-together strength on Friday. EUR/USD’s sharp drop subsequent to disheartening information gave an extra lift to the greenback and caused GBP/USD to turn south.

The upbeat PMI surveys from the UK, however, helped GBP/USD find support. S&P Global’s Composite PMI for the UK arrived at 52.8 in July’s flash estimate, surpassing the market expectation of 52.5, and the Manufacturing PMI came in at 52.2, compared to analysts’ estimate of 52. Although this data is hardly encouraging, it reminded investors of the fact that the UK economy is in a better position overall than the European economy.

Commenting on the data, “UK economic growth slowed to a crawl in July, registering the slowest expansion since the lockdowns of early-2021,” noted Chris Williamson, Chief Business Economist at S&P Global Market Intelligence.”Although not yet in decline, with pent-up demand for vehicles and consumer-oriented services such as travel and tourism helping to sustain growth in July, the PMI is now at a level consistent with just 0.2% GDP growth.”

Later in the day, the US PMI data will be looked upon for fresh impetus. In case these surveys show that the business activity in the US private sector continued to expand at a healthy pace in July, the dollar could end the week on a strong note. On the other hand, weaker-than-expected PMI prints could force investors to move away from the greenback ahead of next week’s highly-anticipated FOMC meeting.

Technical Analysis