GBP/USD tumbles to lows near 1.2350 ahead of UK PMI

The selling pressure around the Sterling is now picking up pace, dragging GBP/USD to the area of 1.2350, or fresh daily lows.

GBP/USD weaker on USD-buying, UK data on sight

Spot is retreating for the fourth session in a row so far today, threatening to break below the consolidative theme that has been prevailing since late January against a backdrop of increasing buying interest surrounding the greenback.

The demand for USD has been once again fuelled by the likeliness of a Fed’s move later this month, all in response to the hawkish tone by Fed speakers in past sessions, which has somewhat offset Trump’s SOTU speech on Tuesday.

At his speech before Congress, Trump failed to give extra details on his plans to boost infrastructure and his recently announced ‘phenomenal’ tax reform, although the general tone was seen as quite positive by investors, lending extra legs to USD rally.

Later in the session UK’s Manufacturing PMI for the month of February is due along with BoE’s Consumer Credit, Net Lending to Individuals, M4 Money Supply and Mortgage Approvals.

On the USD-side, US ISM Manufacturing is expected to have eased a tad last month, seconded by Personal Income/Spending, January’s inflation gauged by the PCE, Markit’s Manufacturing PMI and the speech by Dallas Fed R.Kaplan (voter, hawkish). Closing the docket, the Fed will publish its Beige Book.

GBP/USD levels to consider

As of writing the pair is losing 0.14% at 1.2363 and a break below 1.2351 (low Mar.1) would aim for 1.2344 (low Feb.7) and finally 1.2250 (low Jan.19). On the flip side, the initial up barrier aligns at 1.2410 (100-day sma) followed by 1.2474 (20-day sma) and then 1.2572 (high Feb.24).