Sterling gained over a cent against the euro on Wednesday and made gains across the board including positive movement against the US dollar as the services industry expanded at a faster rate than forecast. After falling sharply in October, the Purchasing Managers’ Index (PMI) data from the services sector beat economists’ expectations amid belief that falling oil prices were offsetting the higher cost of wages.
With the UK economy seemingly slowing less than previously thought, sterling posted strong gains across the board. This was heightened through the afternoon as Chancellor Osborne presented his autumn forecast statement to parliament. Sterling rose to a three-week high versus the euro as Osborne outlined a stronger growth forecast than in his budget address earlier in the year. With unemployment also forecast to drop to 5.4% in 2015, sterling found broad support.
Today sees no slackening off in the number of economic releases. Chief among these will be the latest interest rate decisions from both the Bank of England and European Central Bank, although neither bank is expected to change monetary policy at this month’s meetings.