After weakening throughout the course of last week due to the energy crisis, the pound staged a brief rebound against the dollar on Friday. This was partly due to risk sentiment lifting, which weakened safe haven currencies and boosted the pound.
Sterling strengthened against the euro and dollar at the end of last week and is still stronger this morning. The pound was also helped by the easing of the fuel crisis. Although the situation has improved in most of the UK, London and the South East are still suffering from shortages.
This week, PMI data for the UK will be released, detailing how the economy fared in September. The figures for the services industry and composite (which encompasses services and manufacturing), are due to show a slight drop from August, but are still expected to show that these sectors are growing.
