Sterling Dips on PMI news
Sterling tripped up after poorer than expected UK PMI numbers (Purchasing Managers Index).
The UK currency was down versus the dollar and softer against the euro after a purchasing managers’ survey showed less growth in the UK services sector than was forecast.
March’s PMI number fell to 56.5 from 58.4 in February, in a survey by Markit and the Chartered Institute of Purchasing and Supply. This was a bigger fall than expected.
Output in Britain’s service sector was down due to the weather in a cold January reversing the previous month’s gain.
Sterling was down to around $1.5232 against the dollar- a fall of more than 0.2 percent on the day — from around $1.5280
EUR GBP rose to 87.83p from 87.65p though it was still down 0.4 percent over the day. So a case of bad news from the UK but worse feelings on the Euro. We’d expect the trend to continue (we are bearish on EUR GBP) as the UK election approaches. We expect the Tories to gain an overall majority which should push market in the pound favour.
