The sterling pound weakens against the dollar behind the preliminary data of the United Kingdom PMI and the US of April

• The sterling pound works below its peers since the preliminary PMI of the United Kingdom contracted unexpectedly in April.
• Trump relies on closing bilateral agreements with several nations soon.
• Investors expect the preliminary data of the US PMI for April.

The sterling pound (GBP) quotes downwards against the US dollar (USD) around 1,3280 in the American session on Wednesday. The GBP/USD torque weakens as the US dollar (USD) attracts offers despite the publication of the data of the purchasing managers index (PMI) of the United States Global S&P (USA) for April, which were weaker than expected. He US dollar index (DXY), which follows the value of the dollar against six main currencies, is abruptly recovered to about 99.60. During European negotiation hours, the USD index gave initial profits and fell back to about 99.00.

S&P Global has reported that the compound PMI fell to 51.2 from 53.5 in March. This indicates that general business activity grew at a moderate pace. The slower growth than expected in the activity of the services sector was responsible for the weak compound PMI. The PMI of Services, which measures the activities in the services sector that represent two thirds of the economy, stood at 51.4, compared to estimates of 52.8 and the previous publication of 54.4. However, the manufacturing PMI expanded at a faster rate at 50.7. Economists expected the data to have fallen to 49.4 from 50.2 in March.

The agency has warned that the announcement of the tariff policy by the US president Donald Trump is expected to boost inflation. “Tariffs are cited, meanwhile, as the main cause of the highest prices, although labor costs also continue to increase, which causes companies Margin of the Federal Reserve (FED) to reduce interest rates at a time when an economy in deceleration seems to need an impulse, “said Chris Williamson, head economist of Business in S&P Global Market Intelligence.

Meanwhile, the preliminary data of the Global/CIPS PMI S&P of the United Kingdom (UK) for April, published during the European negotiation hours, were worse, which has strongly weighed on the British currency. The PMI report has shown that general business activity contracted unexpectedly due to a strong fall in the services sector. A figure below the 50.0 threshold is considered a contraction in business activities. The compound PMI is located at 48.2 against estimates of 50.4 and the reading of March 51.5, the first fall since October 2023.

The PMI of services contracts 48.9 from expectations of 51.3 and from 52.5 in March. The PMI report has indicated that the growing global economic uncertainty and depressed domestic conditions were the main factors that weighed on production. Meanwhile, the manufacturing PMI has contracted again at a faster rate at 44.0, as expected, in the face of the previous reading of 44.9.

The agency is also pessimistic about the expectations of business activity considerably in both sectors, manufacturing and services, with general confidence levels at its lowest point in two and a half years. According to the report, respondents mostly attributed the weakening of business feeling to the high recession risks in the country and abroad. Many companies reported a negative impact on growth projections due to commercial tensions with the US, the growing geopolitical uncertainty and general concerns about the broader business climate of the United Kingdom.

What moves the market today: sterling pound runs below the US dollar

• Earlier in the day, the US dollar gave initial profits despite the optimism about the descales in the commercial war between the United States (USA) and China and the decrease in fears that President Donald Trump dismisses the president of the Federal Reserve (Fed), Jerome Powell, for not lowering the rates.
• While talking with reporters in the Oval office on Tuesday, Donald Trump highlighted a “drastic reduction in commercial deficits” and “increased income” generated by the imposition of tariffs on foreign cars, aluminum and steel. Trump expressed confidence that his administration is negotiating agreements with several countries, which will be effective soon. On the current situation with China, Trump commented that “the discussions with Beijing are going well.” The president added that he believes that “they will reach an agreement.” Trump added that tariffs to China would not be as high as “145%, but they would not be zero.”
• During the negotiation hours in North America, the Wall Street Journal (WSJ) reported that a senior White House official said that “tariffs on China imports would probably be reduced by approximately 50% and 65%.”
• In addition, President Trump dissipated the fears of dismissing Jerome Powell Despite criticizing him for not supporting the expansion of monetary policy. “The press echoes things. No, I have no intention of saying goodbye. I would like to see it a little more active in terms of your idea of ​​lowering interest rates. “
• In the last negotiation sessions, investors were punishing the US dollar and US assets due to Trump’s assault on the independence of the Fed and holders constantly changing commercial policies. Market participants began to doubt the status of safe refuge of the US dollar.
• In the United Kingdom economy, market participants are confident that the Bank of England (BOE) will reduce interest rates at the May policy meeting. Operators have become increasingly confident in a rates reduction next month due to the slower growth than expected in data from Consumer Price Index (CPI) for March and uncertainty about global economic perspectives.
• In addition, salary growth in the United Kingdom is slowing down, which also paves the way for greater relief of monetary policy. The human resources data firm of Great Britain, Brightmine, showed on Tuesday that salary increases grew by 3% during the fourth consecutive quarter, which represents the slowest increase since December 2021.
• This week, investors will also focus on retail sales data from the United Kingdom for March, which will be published on Friday. It is estimated that retail sales data, a key measure of consumer spending, have decreased 0.4% month by month after having increased by 1% in February.

Technical Analysis: The sterling pound goes back to about 1,3300

The pound Sterling About 1,3300 is corrected against the US dollar after visiting a maximum of three years around 1,3430 the day before. However, the perspective The torque remains firm since all exponential mobile socks (EMA) of short -term short are upset.

The 14 -day relative force (RSI) index cools slightly after reaching overstanding levels above 70.00. This indicates a slight correction in the pair after a strong rebound, but the upward trend remains intact.

Upwards, the psychological level of 1,3500 will be a key obstacle to the torque. Looking down, the maximum of April 3 around 1,3200 will act as an important support zone.

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