GBPUSD: UK CBI Index Drops to Nine Year Lows on Brexit Fears
The October UK CBI index slumps to -37, the lowest levels since March 2010, and much lower than the -28 anticipated by economists. The reading shows how the manufacturing sector think their order books will develop in the next three months.
It is likely that the sharp decline is due to Brexit fears, and we could see a bit of a bounce at the next reading, as it looks like Brexit will be delayed. The index is also probably lower on a general economic slowdown, as we have seen across the world in the last few months, with the US ISM, and European PMIs declining. We get the latest reading on the PMIs later this week, and these indicator tend to move the markets.
The CBI index did not trigger GBPUSD traders to react, and the price remains relatively unchanged as traders wait for the outcome of this evening’s UK Brexit votes.