Sterling had a relatively quiet day yesterday, weakening only slightly against a number of trade partners in response to disappointing data from the construction industry’s purchasing managers index (PMI). A measure of the health of the construction sector, the PMI contributes to sentiment surrounding the UK economy and can thus affect sterling strength if any unexpected results are announced. With little significant data being released from other major trade partners, the largest movement in the markets was seen in response to a statement from Russian president Vladimir Putin, with a slight rally for sterling against both the euro and the US dollar later in the day.
Today sees the release of the PMI from the services industry, which could have a greater impact than yesterday’s construction PMI, with the service industry making up a larger and significant part of the UK economy. Expectations are for a reading of 58.0 which will be slightly less than last month but still indicating that the UK economy is expanding. Any variation from expectation will have a knock on effect on sterling but this could be lost in the plethora of other data being released elsewhere and the problems in the Ukraine.
Thinking about buying or selling sterling? Call your trader now for the latest news and rates, as well as for currency-buying strategies.