Pound Drops As U.K. Private Sector Growth Slows To 15-month Low
24 Maio 2022 - 05:00AM
RTTF2
The pound declined against its major counterparts in the
European session on Tuesday, as the nation's private sector growth
slumped to its weakest level since March 2021 as high inflation and
heightened geopolitical uncertainty dampened customer demand in
May.
Survey results from S&P Global and Chartered Institute of
Procurement & Supply showed that the flash composite output
index fell to a 15-month low of 51.8 in May from 58.2 in April.
Economists had expected a score of 56.5.
The services purchasing managers' index dropped to a 15-month
low of 51.8 in May from 58.9 in April. The score was forecast to
rise to 57.
The manufacturing PMI fell to a 16-month low of 54.6 in May from
55.8 in April. Economists had expected the reading to drop to
55.
European shares fell as a profit warning from Snapchat owner
Snap Inc. triggered fears about inflation and tightening hurting
corporate profits.
The social media company projected that revenue and adjusted
EBITDA would be below the low end of guidance reflecting a
deteriorating macroeconomic environment.
The pound edged down to 1.2475 against the greenback, after
rising to 1.2599 at 3:30 am ET. The next likely support for the
pound is seen around the 1.22 level.
The pound touched 0.8585 against the euro, its lowest level
since May 12. On the downside, 0.88 is possibly seen as its next
support level.
The U.K. currency depreciated to a 4-day low of 158.74 against
the yen and more than a 1-year low of 1.2013 against the franc,
down from its prior highs of 160.99 and 1.2156, respectively. The
pound is likely to find support around 153.00 against the yen and
1.18 against the franc.
Looking ahead, U.S. new home sales and Canada manufacturing and
wholesale sales for April will be featured in the New York
session.
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