Despite Upbeat Data Sterling Struggles
The Pound Sterling retreated against the US Dollar and hit a 2-week trough versus the Japanese Yen despite unexpectedly upbeat economic data which only helped to minimize the damage. The latest PMI Services report for December beat analysts’ forecasts with a reading of 56.2 against expectations of a decline to 54.7. This week’s economic surveys, a reflection of sentiment among purchasing managers across wide-ranging industries and sectors, suggests that the post-Brexit vote has thus far had little impact. One FX strategist in Sweden suggested that the strong data should raise the question as to why analysts are pointing to a sluggish Pound.
As reported at 10:42 am (GMT) in London, the GBP/USD was trading lower at $1.2305, down 0.11%; the pair earlier hit a trough of $1.2267 while the session high was at $1.2362. The GBP/JPY was trading at 143.471 Yen, down 0.69%; the pair has ranged from 142.4800 Yen to 144.6500 Yen.
Pound’s Future Pondered
Yesterday, a new ambassador to the European Union was appointed after the previous ambassador quit suddenly. Investors continue to be concerned as to how Britain will withdraw from the European Union and are worried about the economic repercussions of that move. Since the June 23rd vote, the Pound has lost 16% of its value versus the greenback and 14% versus the common currency Euro marking the worst yearly performance since 2008.