Release Explanation: As an indicator of economic performance the PMI has the ability to easily affect currency valuations as Institutions re-align existing positions, or build new, on the strength of these reports. It measures the activity level of Purchasing Managers, who are surveyed on production, employment, inventories, orders, delivery data. The PMI is split into reads on Manufacturing, Service, and Construction industries. A read over 50 denotes growth.

Trade Desk Thoughts: The U.K. Manufacturing PMI continued to disappoint investors in February, posting the second weakest read in its recent history. Weaker global demand outweighed any benefit from sterling's fall against major currencies, and domestic conditions were especially poor due to the crisis affecting car making, construction and retail. The employment element of the index hit a fresh record low, falling to 33.5 from 33.9 as firms cut capacity and costs to match thinner order books. 

Forex Technical Reaction: The pound dropped 100 pips in the first minutes of the Asian session. However, since then the pound has struggled to break below the 1.4200 support level.