Market Optimism Sends Sterling Higher

Barbara Zigah

The preliminary numbers for the November PMI surveys from Markit were released today, and came in better than analysts had predicted.

GBPThe pound sterling was higher against its major rivals during London trade on Monday, after the announcement of positive news regarding a vaccine to combat the spread of COVID-19. That was enough to have FX traders move to higher-risk currencies, including the pound, despite concerns over a Brexit deal. Brexit talks will continue through this week, though analysts acknowledge that time is running out given that the deadline for the transition is in less than six weeks. If a deal can't be made, Britain would be compelled to follow WTO trade rules, which many believe would be disruptive for both the British and the EU economies.

In London trading as of 11:24 am, the GBP/USD was trading at $1.3361, a gain of 0.5343% and sliding away from the session peak of $1.33819. The EUR/GBP was lower at 0.8905 pence, a loss of 0.1883%; the pair has ranged from a trough of 0.88734 pence to a high of 0.89390 pence in today's session. The GBP/JPY was higher at 138.581 yen, up 0.4305%, off the session high of 138.899 yen.

UK PMIs Unexpectedly Upbeat

The preliminary numbers for the November PMI surveys from Markit were released today, and came in better than analysts had predicted. The Markit Manufacturing survey reading was 55.2, well above the 50.5 that economists had predicted, and above the previous reading of 53.7. The Markit Services sector PMI was also better at 45.8 against a predicted 42.5. Manufacturing and services sector figures for the US economy are also due today. A recent poll shows that most analysts expect to see a decline in the November numbers, down to 53 for the manufacturing survey and 55.3 for the services sector survey; the previous readings were 53.4 and 56.9, respectively.

Barbara Zigah

After working on Wall Street, Barb began her second career as a freelance writer at Daily Forex, where the CEO recognized fresh, untapped potential and was willing to give her a try. She’s never looked back. Since then, she’s worked steadily as a freelance writer and editor in the financial services and Forex-related industry.

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