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

The UK services PMI overview

The UK economy will release its April services PMI later in the European session at 0830 GMT, which is expected to come in at 50.5 versus 48.9 booked in March. 

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 50 pips in deviations up to 2.5 to -2, although in some cases, if notable enough, a deviation can fuel movements of up to 70 pips.

How could affect GBP/USD?

Haresh Menghani, Analyst at FXStreet explains: “From a technical perspective, nothing seems to have changed much for the pair and the set-up remains in favour of bullish traders, albeit the 1.3080-1.3100 region now seems to have emerged as an immediate strong hurdle. A convincing break through the mentioned barriers has the potential to continue lifting the pair further towards its next major resistance near mid-1.3100s - 23.6% Fibo. level of the 1.2396-1.3381 up-move. On the flip side, any meaningful pullback towards 38.2% Fibo. level support near the key 1.30 psychological mark might still be seen as a buying opportunity.” 

Key Notes

GBP/USD now seen at 1.3700 in 12 months – Reuters poll

BoE’s Deputy Gov Broadbent: Expect rates to rise in a limited and gradual manner

Non-Farm Payrolls Preview: Don't speak of gloom, show me

About the UK services PMI

The PMI service released by both the Chartered Institute of Purchasing & Supply and the Markit Economics is an indicator of the economic situation in the UK services sector. It captures an overview of the condition of sales and employment. It is worth noting that the UK service sector does not influence, either positively or negatively, the GDP as much as the Manufacturing PMI does. Traders want the highest possible reading as that will be taken as positive for the GBP. Any reading above 50 signals expansion, while a reading under 50 shows contraction.