Yesterday proved to be a good day for sterling, with impressive manufacturing and production data pushing the pound to its highest levels against both the euro and US dollar since early March. Industrial production rose 0.9% throughout February, far exceeding the expected 0.3% increase. This jump in production was the biggest in 8 months, with growth of 1% in the manufacturing sector contributing to much of the increase. As this positive news fuelled investor confidence in sterling, a separate report from the International Monetary Fund showed that it had upgraded its outlook for the country’s economy, forecasting growth of 2.9% this year.
Yesterday showed that market movement can occur when least expected, although today there is no major data expected until the release of the US Federal Open Market Committee meeting minutes this evening. Any surprises that impact on the US dollar could have an effect on sterling.
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