Pound Falls as Strong US Data Revives Dollar Demand

The British pound fell against the US dollar on Monday as strong ISM manufacturing data from the United States boosted demand for the greenback, sending GBP/USD lower in early European trading.

The US Dollar Index (DXY) rose after the Institute for Supply Management (ISM) reported a robust manufacturing PMI, indicating resilience in the US economy. This led investors to reassess their bets on Federal Reserve rate cuts, supporting the dollar across the board.

The ISM manufacturing index exceeded market expectations, reflecting improved new orders and production. Such data suggests sustained economic momentum, which typically reduces the likelihood of imminent monetary easing.