UK pound is heading lower again, dropping as concerns about the economy continue to weigh. This time slightly disappointing PMI is leading to a lower sterling.
Sterling continues to struggle in currency trading, especially against the euro and the dollar. UK pound is being affected by the latest PMI readings. Service sector PMI came in at 55.5, when many analysts had expected to see 55.6.
Even though the data was slightly disappointing, it is still clear that the labor market and the economy in the United Kingdom are improving. Indeed, some expect things to improve enough that the Bank of England will have to take notice — and action — soon. This could help the sterling against the euro, although the UK pound is likely to remain somewhat weak against a strengthening dollar.
Also weighing on the sterling is the performance of stocks. The FTSE 100 is dropping once again, along with other global indexes, thanks to more problems in China, and as oil prices continue to fluctuate. It’s a global stock market rout, and that is weighing on all high beta currencies.
At 14:18 GMT GBP/USD is lower, dropping to 1.4567 from the open at 1.4630. EUR/GBP is higher, moving up to 0.7448 from the open at 0.7373. GBP/JPY is down to 171.8200 from the open at 173.3380.
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