Investing.com - The pound fell to the lowest levels of the day on Wednesday after data showing that output in the U.K. construction sector expanded at the slowest rate in seven months in November.
GBP/USD was down 0.28% to 1.5038 from around 1.5065 ahead of the data.
The Markit U.K. construction purchasing managers' index fell to 55.3 from Octobers 58.8. Economists had expected a reading of 58.2.
On the index, a reading above 50.0 indicates expansion, below indicates contraction.
Growth momentum softened across the U.K. construction sector in November, with output, new business and employment all rising at slower rates than in the previous month, the report said.
Residential building activity increased at the weakest pace since June 2013, while civil engineering activity rose at the slowest rate for six months.
“The UK construction recovery is down but not out, according to November’s survey data. Aside from a pre-election growth slowdown in April, the latest expansion of construction activity was the weakest for almost two-and-a-half years amid a sharp loss of housebuilding momentum,” said Tim Moore, senior economist at survey compilers Markit.
The pound was also lower against the euro, with EUR/GBP rising 0.22% to 0.7065 ahead of preliminary data on euro zone inflation later in the session.
The single currency remained on the defensive amid heightened expectations that the European Central Bank will announce further monetary easing measures at its meeting on Thursday.
The dollar was steady against the other major currencies, as expectations for higher U.S. interest rates continued to underpin investor demand.
The U.S. dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, was at 99.95, not far from Monday’s highs of 100.36, the most since mid-April.
The greenback eased after the Institute for Supply Management reported Tuesday that U.S. manufacturing sector contracted last month, slowing to the weakest level since June 2009.
The weak data was seen as unlikely to prompt the Federal Reserve to delay hiking rates next month, but sparked fears that further monetary tightening could hamper the U.S. economic recovery.
Investors were looking ahead to Friday's U.S. jobs report for November for fresh indications on prospects for a December rate hike. The U.S. was to release data on private sector jobs growth later in the day.