GBP/USD nears multi-month top ahead of UK data dump, election drama continues
|- GBP/USD stays firm around the highest since April.
- UK PM gets criticism over the leaked document, failure to sympathize with the hospitalized boy in the final countdown to December 12 election.
- UK Manufacturing/Industrial Production, trade balance and monthly GDP to decorate the British economic calendar.
GBP/USD remains mildly bid around 1.3150 ahead of the London open on Tuesday. The pair surged to April month high during the previous day but languishing lead of the ruling Conservatives over the opposition Labour Party dragged it from further upside.
Opinion polls from the ICM showed Tories' lead down to 6 points and raised fears of a surprise Conservative defeat, or a hung parliament, amid the latest round of verbal attacks on the United Kingdom (UK) Prime Minister (PM) Boris Johnson.
The Conservatives’ leader is under fresh fires after a leaked document cited by the Financial Times and the BBC says the UK government will struggle to deliver the infrastructure and staffing needed to deliver Brexit. The documents also revealed that the UK PM is considering checks on Northern Ireland border, which the Democratic Unionist Party, Arlene Foster, said has been turned down. Additionally, the front-runner’s act of avoiding to see the photo of a four-year boy getting poor National Healthcare Systems (NHS) services also got broad criticism.
On the other hand, the United States (US) and China are still at loggerheads as far as the phase-one is concerned, which in turn drags the US Dollar (USD) down since the week’s start.
Moving on, final rounds of pitching and public visits by the Conservatives and Labour Party members will be important whereas October month UK data dump and third quarter (Q3) US jobs data will decorate the economic calendar. “We're in line with consensus is looking for a modest 0.1% m/m gain for October GDP. We look for a small 0.2% increase in manufacturing activity after two months of declines, but the services sector is unlikely to add much to overall activity, so GDP growth should be fairly subdued. This sets up Q4 GDP to come in line with the BoE's forecast of 0.2% q/q,” say analysts at TD Securities.
Technical Analysis
April month high near 1.3200 is in the spotlight ahead of March 27 top surrounding 1.3270. Meanwhile, pair’s declines below 1.3100 will trigger fresh downpour.
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