Cable remains flat despite more negative UK data

It was a quieter day in terms of data releases in the UK on Thursday which led to cable remaining relatively flat. Rates dipped just below $1.62 for the second day running and hit a low of $1.6171 as poor service sector data kept rates in a 35 pip range (as the graph below shows). Further losses were reduced as fears over the economic state of the euro-zone continued to push investors towards the safety of the pound.

Growth in the UK's service sector slowed down in April but remained "solid", according to figures. The Purchasing Managers index (PMI) slipped to 53.3 in April compared to 55.3 in March. A number above 50 indicates growth. As I mentioned earlier in the week PMI data indicated growth had also slowed in both the manufacturing and construction sectors.

In the states there was some more positive news in the form of initial jobless claims and continuing jobless claims. Both came in lower than forecast and could be seen as a sign the U.S economy is growing. This could lend support to the dollar and ease fears of further monetary stimulus from the Fed.

While the UK seems to bouncing between positive and negative data releases it is hard to see which way the markets will move. If you are thinking of buying or selling dollars STOP and LIMIT orders can help you take advantage of any positive market movements but at the same time protect you if rates suddenly fall away. To discuss your options in more detail click here to send me a direct email or complete the contact form on the homepage of the blog.