Sterling today has given back most of the gains accrued on the first day of September.
Economically speaking, there wasn’t any very good news out of Britain this morning. The Nationwide House Price Index fell three times farther than expected, showing a drop of 0.9% in August and posting its second loss in a as many months. This seemed to correlate pretty well with the UK Construction PMI report also out this morning that showed growth in that sector had slowed again in August as well. With a reading of just 52.1 and having fallen over 6% in the last two months, this index is moving ever closer to showing a contracting environment. In sort of a switch-a-roo, while the pound was getting hurt by negative UK economic data, it was actually positive US data which bolstered the pound earlier. After a much, much better than expected US Pending Home Sales report the GBP surged higher as risk appetite once again weakened the US dollar and allowed the pound to rise.
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