Pound Falls Ahead Of PM Boris Johnson's New Brexit Plan

The pound slipped against its major counterparts in the European session on Wednesday, as the nation's construction sector contracted further in September and investors awaited Prime Minister Boris Johnson's speech outlining final Brexit offer at the Conservative Party's annual conference today.

Survey data from IHS Markit showed that the U.K. construction Purchasing Managers' Index fell to 43.3 in September from 45.0 in August. The score was forecast to remain unchanged at 45.0.

This was the second strongest contraction since April 2009. Any reading below 50 indicates contraction.

Johnson is expected to take a tough stance on Brexit, with investors cautious about his plan being accepted by the European Union.

The Telegraph reported that the new plan proposes Northern Ireland following single market rules until 2015, replacing the backstop proposal.

The pound declined to 0.8919 against the euro from Tuesday's closing value of 0.8879. On the downside, 0.91 is likely seen as the next support level for the pound.

The pound that closed Tuesday's trading at 1.2301 against the greenback edged lower to 1.2227. Next immediate support for the pound is seen around the 1.21 region.

The pound dropped to 131.62 against the yen, its lowest since September 9. The currency is likely to face support around the 129.00 region.

Data from the Cabinet Office showed that Japan's consumer confidence fell to the lowest level in more than eight years in September.

The consumer confidence index fell to a seasonally adjusted 35.6 in September from 37.1 in August.

On the flip side, the pound rose to 1.2264 against the franc and held steady thereafter. The pair ended yesterday's trading at 1.2219.

Data from the Federal Statistical Office showed that Swiss consumer price inflation eased to the lowest in 33 months in September.

Inflation eased to 0.1 percent in September from 0.3 percent in August. Economists had forecast the rate to remain unchanged at 0.3 percent.

Looking ahead, U.S. ADP private payrolls for September is due to be released at 8:15 am ET.