05/02/2020

UK construction data lifts sterling


GBP

The pound rebounded off six week-lows against the dollar on Tuesday, after better than expected construction activity data offset fears of a hard Brexit, fuelled by the government’s tough stance in European Union trade talks. The move reversed losses in early trading which was due to the concern that Britain may fail to clinch a trade deal by the end of an 11-month transition period.

Output in the UK’s construction sector in January fell at its slowest pace since May last year. This was taken as a good sign of green shoots for Britain’s builders amid lower political uncertainty. The IHS Markit/Cips gauge of construction output rose to 48.4 in December. The reading was still below the 50 no-change mark, but was nonetheless the best score for eight months.

Key Announcements

12:15 – EUR: ECB President Lagarde Speaks.
13:15 – USD: ADP Non-Farm Employment Change forecast to fall to 150K.


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