U.K manufacturing activity slowed in April amid growing uncertainty across the economy ahead of Brexit.

The manufacturing Purchasing Managers' Index survey showed manufacturing activity grew at a slower pace than projected in the month, the PMI stood at 53.9, a 17-month low, IHS Markit report showed.

The report provided additional evidence of a slowdown in the economy as both output growth and demands eased along with business optimism that dipped to a five-month low. Another sign that business confidence has started suffering from growing uncertainty in the region amid global trade war and a potential rate increase in the U.S. that could see more capital flights from the U.K.

Again, new exports that have consistently offered support to the sector slowed to a 10-month low in the month, while rates of increase eased in intermediate and investment goods sectors, but strengthened at consumer goods level. Meaning, consumers are the one currently sustaining the economy but with the wage growth still low, one can only hope growth in new business sustain job creation and domestic consumption.

“It appears the disappointing start to the year is set to continue in the second quarter. With weaker than anticipated economic conditions and the pound falling again,” said Duncan Brock of the Chartered Institute of Procurement & Supply, which sponsors the PMI survey.

The pound dipped further against the Japnese Yen as shown below to trade at 149 price levels. However, we are bearish on GBPJPY and expect the pair to extend its bearish movement below the ascending line of the bearish wedge to 143.50 support level.