When is UK construction PMI and how could it affect GBP/USD?

UK construction PMI overview

The UK construction PMI for July is due for release today at 0830GMT, with the figure expected to come in a tad weaker at 54.5, when compared to June’s 54.8 points.

Deviation impact on GBP/USD

 Readers can find FX Street's proprietary deviation impact map of the event below. As observed the reaction is likely to remain confined between 10 and 45 pips in deviations up to 2 to -2, although in some cases, if notable enough, a deviation can fuel movements of up to 70 pips.

How could affect GBP/USD?

A positive surprise in the construction sector activity report would provide much-needed impetus to the GBP bulls, which would send the rate back higher for a retest of 11-month tops of 1.3244. On the other hand, a bigger-than expected drop in the PMI reading could knock-off the GBP/USD pair to test 1.3150 levels.

An unexpected rise in the construction PMI report cannot be ruled out, given yesterday’s solid manufacturing sector activity numbers, as the construction PMI has widely shown the similar behaviour as the manufacturing and services PMIs, analysts Societe Generale pointed out in a research note.

Key notes

GBP/USD Forecast: bullish bias remains, UK PMI and ADP report in focus

Haresh Menghani, Analyst at FXStreet notes, “Currently hovering around the 1.3200 handle, investors now look forward to the release of UK Construction PMI, due later during European trading session. Apart from the UK PMI print, the US private sector employment details - ADP report, will also be in focus on Wednesday and would be looked upon for some trading opportunities ahead of the official jobs report (NFP) on Friday.”

About UK construction PMI

The PMI Construction released by the Chartered Institute of Purchasing & Supply and Markit Economics shows business conditions in the UK construction sector. It is worth noting that the construction sector does not influence, either positively or negatively, the GDP as much as the Manufacturing sector does A result that values above 50 signals appreciates (or is bullish for) the GBP, whereas a result that values below 50 is seen as negative (or bearish).