The outlook is less positive due to sentiment for GBP
For the UK, GDP and manufacturing data for February, due out on Friday, will guide the Pound. Forecasts show monthly GDP growth will slow to 0.1% after increasing 0.2% in January.
The Index of Industrial Production (IIP) is expected to stagnate after falling 0.2% in January and is estimated to have increased 0.6% annually from the previous level of 0.5%. Monthly Manufacturing Production data is expected to increase 0.1% after stagnating in January. However, on a year-over-year basis, the data is expected to increase at a faster pace of 2.1% compared to the previous month. Previously it was 2.0%.
UK factory data is a leading indicator of aggregate demand from domestic and overseas markets. Positive factory data could boost hopes of the UK economy exiting a technical recession.
Technical analysis: British Pound faces downside risks around 1.2500
The British Pound seems to be heading towards the 1.2500 support level due to the “risk-off” sentiment. The GBP/USD pair has crossed below the 200 EMA at 1.2570, which was an important support level before the US CPI data was released. Cable could see a real pullback if it loses the 1.2500 mark. The RSI indicator is fluctuating near 40. If it falls below this level, a bearish momentum will be triggered.
The Index of Industrial Production (IIP) is expected to stagnate after falling 0.2% in January and is estimated to have increased 0.6% annually from the previous level of 0.5%. Monthly Manufacturing Production data is expected to increase 0.1% after stagnating in January. However, on a year-over-year basis, the data is expected to increase at a faster pace of 2.1% compared to the previous month. Previously it was 2.0%.
UK factory data is a leading indicator of aggregate demand from domestic and overseas markets. Positive factory data could boost hopes of the UK economy exiting a technical recession.
Technical analysis: British Pound faces downside risks around 1.2500
The British Pound seems to be heading towards the 1.2500 support level due to the “risk-off” sentiment. The GBP/USD pair has crossed below the 200 EMA at 1.2570, which was an important support level before the US CPI data was released. Cable could see a real pullback if it loses the 1.2500 mark. The RSI indicator is fluctuating near 40. If it falls below this level, a bearish momentum will be triggered.
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TP1: 1.2600
TP2: 1.2650
SL: 1.2500