Pound Holds Near One-Month High Helped by Strong PMI Data
The pound traded just below $1.34, hovering near its strongest level in a month as investors assessed a mixed batch of economic data ahead of next week’s budget and the Bank of England’s November 5 policy meeting. Flash PMI data showed UK private-sector activity accelerated to its fastest pace since February, beating expectations across both manufacturing and services. However, retail sales fell more sharply than expected in September, while consumer confidence recorded its steepest monthly decline since the pandemic, reflecting persistent cost-of-living pressures and concerns over the Middle East conflict. Stronger-than-expected inflation data earlier this week prompted markets to increase bets on further monetary tightening, with at least three quarter-point rate hikes priced in by April 2027 and the first potentially coming as early as November 5. Investors now await next week’s budget, where Chancellor John Healey is expected to emphasize fiscal discipline.
The pound traded just below $1.34, hovering near its strongest level in a month as investors assessed a mixed batch of economic data ahead of next week’s budget and the Bank of England’s November 5 policy meeting. Flash PMI data showed UK private-sector activity accelerated to its fastest pace since February, beating expectations across both manufacturing and services. However, retail sales fell more sharply than expected in September, while consumer confidence recorded its steepest monthly decline since the pandemic, reflecting persistent cost-of-living pressures and concerns over the Middle East conflict.
Stronger-than-expected inflation data earlier this week prompted markets to increase bets on further monetary tightening, with at least three quarter-point rate hikes priced in by April 2027 and the first potentially coming as early as November 5. Investors now await next week’s budget, where Chancellor John Healey is expected to emphasize fiscal discipline.