Sterling strengthened to its highest level against the dollar since last year yesterday and reached a 3-month high against the euro. Strength against the dollar is mainly due to greenback weakness, which came about after the Federal Reserve’s change of stance towards inflation.
UK Manufacturing PMI data was revised slightly lower to 55.2 in August, from 55.3 in the preliminary estimate. However, the reading still signals the strongest growth in factory activity since February of 2018, as companies restarted operations following the coronavirus lockdowns. The figures also show that employment in the sector declined steeply.
Data released for the UK yesterday also showed that the number of mortgages approved in July increased significantly. Although it is still below pre-COVID levels, this shows that the economy is recovering.
