Sterling falls to lows across the board

Sterling had a difficult Monday thanks to the release of lower-than-expected manufacturing purchasing managers’ index (PMI) figures from December, which cast further fears over the pace of the UK economic recovery. These were the first figures in what looks set to be a data-heavy week after a relatively quiet period – meaning the markets were on alert waiting for the figures, so the impact was felt. On release of figures sterling fell hitting a fresh two and a half month low against the euro, and falling to the lowest price since April versus the US dollar. It did recover as the day wore on.

Today sees the release of PMI data from the UK construction industry. Having reported below the expected level last time out, growth is expected to have accelerated throughout December to show solid growth.