GBP/USD takes a break from sustained losses near 1.3150

• GBP/USD churned the waters on Thursday, finding a floor near 1.3150.
• Ongoing US government shutdown adds further weight to wobbly private data.
• UK data docket remains limited until the BoE's interest rate decision this week.

GBP/USD has managed to keep pumping the brakes at the outset of another trading week, finding enough friction to hold off on further declines as price action toys with the 1.3150 level. A technical rebound has yet to materialize, and Cable is likely to continue some rough chop in the interim as Pound Sterling (GBP) traders await the Bank of England's (BoE) latest interest rate decision.

The latest Institute for Supply Management (ISM) Purchasing Managers Index (PMI) report dipped to 48.7 in October, missing expectations and falling back slightly from September's 49.1. Demand indicators within the ISM report broadly improved over the month; however, all remain in contraction territory, implying that businesses are struggling to find new customers or convince current clients to expand their operations. Overall, manufacturing activity among businesses that bothered to submit responses to surveys showed a net decline in economic activity in the manufacturing sector for an eighth straight month.

Amid the ongoing US government shutdown, investors are tilting further into giving a level of consideration to private datasets that may not necessarily be due. Response rates to private surveys are notoriously low, and in a questionable economic environment where official, large-scale data isn't available, the volatile and generally inaccurate nature of private data means investors may get caught on either side of the margin of error line thanks to faulty recency bias.

Little of note lies on the UK side of this week's data docket until the BoE's upcoming interest rate decision on Thursday. Even here, little change is expected. The Monetary Policy Committee (MPC) is expected to vote six-to-three to keep interest rates unchanged. The addition of another rate cut vote will be of some note for particularly attentive central bank policy wonks; however, meaningful changes in the BoE's interest rate stance are unlikely to materialize with the UK's headline inflation rate standing at 3.8% as of August, nearly double the BoE's preferred 2% target band.

GBP/USD daily chart

The addition of another rate cut vote will be of some note for particularly attentive central bank policy wonks; however, meaningful changes in the BoE's interest rate stance are unlikely to materialize with the UK's headline inflation rate standing at 3.8% as of August, nearly double the BoE's preferred 2% target band.