• GBP/NZD edged lower on Thursday as softer UK business activity data and political uncertainty pressured the pair.
• The weaker business activity reading contrasted with recent stronger economic signals. First-quarter GDP data released last week showed solid growth, while Wednesday’s CPI report indicated inflation eased to 2.8% in April from 3.3% in March, below the 3.0% forecast, highlighting a mixed macroeconomic picture.
• S&P Global’s preliminary UK Composite PMI fell sharply to 48.5 in May from 52.6 in April, slipping below the 50.0 threshold for the first time since April 2025 and well under the 51.6 Reuters poll median, signaling a contraction in activity.
• The figure overshadowed recent positive British data reads, including strong Q1 GDP figures last week and inflation figures on Wednesday.
GBP/NZD near-term risks are tilted to the downside as geopolitical tensions and domestic policy changes create a more uncertain market backdrop.
• Immediate resistance is located at 2.2894(SMA 20), any close above will push the pair towards 2.3023(61.8%fib).
• Immediate support is seen at 2.2840(50%fib) and break below could take the pair towards 2.2671(Lower BB).
Recommendation: Good to sell around 2.2900 with stop loss of 2.2980 and target price of 2.2800
