PMI Data Tanks Sterling Again
The Pound Sterling edged lower versus both the Euro and the US Dollar after the latest PMI survey showed further slowing of the services sector. According to Markit’s report, March’s services sector PMI fell to 51.7 from an expected 54.0 reading, down from 54.5 reported in February. Analysts blame the severe snow storms that hampered the economy during the period, coupled with weakened consumer demand, for the decline. The concern is what impact this data might have on the Bank of England as they consider a tightening path. One FX strategist believes that inflation data will be the key to their decision but says that inflation should remain above the BoE 2% target.
As reported at 11:19 am (BST) in London, the GBP/USD was lower at $1.4049, down 0.16%; the pair earlier hit a session trough of $1.4033 while the peak is at $1.4097. The EUR/GBP is trading at 0.87342 Pence, a gain of 0.11837%; the pair has ranged from a session trough of 0.87159 Pence to a peak of 0.87380 Pence.
Eurozone Data Mixed
The Eurozone was not without its own disappointing economic data; Markit reported that the services sector PMI fell to 54.9 down 55.0, while Eurostat reports that retail sales suffered an unexpected decline in February. Retail sales on a year-over-year basis were reported at 1.8% in February while January’s figures wee revised down to 1.5% from 2.3%. Producer price inputs were higher year-over-year, beating expectations at 1.6% while the previously reported figures were upwardly revised to 1.6% from 1.5%; analysts had forecasted the numbers would be unchanged. The EUR/USD was trading at $1.2278, down 0.03% and well off the session peak of $1.22903.