GBP/USD extends PMI-led rally near 1.3250

The ongoing bullish momentum behind the GBP gained further traction following the release of above estimates UK construction PMI report, now driving GBP/USD towards the mid-point of 1.32 handle.

GBP/USD eyes Monday’s high

Currently, GBP/USD trades +0.52% higher at 1.3248, easing-off session tops printed at 1.3256 some minutes ago. The cable extends gains this session as the bulls remain underpinned by better-than expected UK construction sector activity report for the month of July. The final Purchasing Managers' Index (PMI) in the UK fell further to 45.9 points in July after having dropped to 46 points in June. Markets had predicted a drop to 43.8 in July.

Moreover, broad based US dollar sell-off, fuelled by aggressive selling seen in USD/JPY after stops triggered below 102 barrier, also offered fresh impetus to the renewed rally in the GBP/USD pair.

With the UK data out of the way, focus shifts towards the US economic data due out later in the NA session. The core PCE price index and personal spending data will be reported from the US docket. Meanwhile, the main risk event for the pound this week remains the BOE interest rate decision, scheduled for announcement this Thursday.

GBP/USD Levels to consider                           

The pair has an immediate resistance at 1.3276 (Aug 1 high), above which 1.3305 (Jul 29 high) would be tested. On the flip side, support is seen at 1.3176/71 (daily low/ 20-DMA) below that at 1.3150 (psychological levels).