Daily digest market movers: Pound Sterling to be guided by flash UK S&P Global/CIPS PMI data
- The Pound Sterling exhibits a mixed performance against its major peers as investors have sidelined ahead of the preliminary UK S&P Global/CIPS data for August. The flash PMI report will hint at the current status of the UK economy. Economists estimate that the Composite PMI improved marginally, to 52.9 from 52.8 a month earlier, led by a sharper expansion of activity in the service sector. Meanwhile, activity in the manufacturing sector is seen growing at a steady pace.
- The flash PMI report could also show a significant improvement in employers’ morale and firm labor demand as a result of the Bank of England (BoE) interest-rate cut in August. This was the first reduction in borrowing costs since December 2021, when it started tightening monetary policy to contain high inflationary pressures bolstered by pandemic-led stimulus.
- This week, the major trigger for the Pound Sterling will be the BoE Governor Andrew Bailey’s speech at the JH Symposium on Friday. Andrew Bailey may guide about whether the BoE will cut interest rates again in September. Also, investors would look for cues over the outlook on wage growth and service inflation.
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