Pound Extends Slide On Weak UK PMI

The pound extended its decline against other major currencies on Tuesday's early European deals after a report showed that the country's manufacturing PMI dropped more than expected in April.

The UK's manufacturing sector growth slowed in April amid sharp decline in new export orders, a survey by Markit Economics revealed today.

The Markit/Chartered Institute of Purchasing & Supply (CIPS) purchasing managers' index for the factory sector fell to 50.5 in April from a revised 51.9 in March. Economists expected a reading of 51.5, down from March's initial score of 52.1.

The pound that closed yesterday's deals at 1.6237 against the greenback reached a 4-day low of 1.6194. The next downside target level for the pound is seen at 1.615.

Against its European and Swiss counterparts, the pound fell to 6-day lows of 0.8200 and 1.4658 with 0.825 and 1.46 seen as the next downside target levels, respectively. At Monday's close, the pound traded at 0.8156 against the euro and 1.4737 against the franc.

The pound reached a new 2-week low of 129.13 against the yen, compared to Monday's close of 129.62. On the downside, the pound may target 128.5 level.

From the U.S., ISM manufacturing data for April and construction spending for March are set for release in the New York morning session.