A difficult day for sterling saw it extend its recent run of losses against the euro, as speculation mounts that the Greek government will strike a refinancing deal with creditors by the end of this week. Wednesday’s first major data release was the Purchasing Managers’ Index (PMI) from the services sector, and revealed the weakest level of growth in this sector since January. A reading of 56.5 pointed to continued growth in the sector, but missed the level of growth forecast by economists. This disappointing data saw sterling fall across the board, as optimism over UK economic growth throughout the second quarter of the year was dealt another blow. Sterling was able to recover some ground against the US dollar throughout the afternoon however, as US manufacturing growth also showed a surprise slump throughout May.
Today sees confirmation of the UK interest rate for the next month. This is widely expected to remain at 0.5%, and should pass with little effect on the markets. Investors will be more keenly awaiting further news from the Eurozone, as well as unemployment claims from the States later in the afternoon.