Sterling, buffeted over the past fortnight by concerns that it is heading a “hard” resolution of its divorce with the European Union that will hurt its economy by more, traded at a 31-year low of $1.2687 in early trade in London.
It was down almost 0.4 percent at 88.31 pence per euro, better than expected readings of sentiment among construction and manufacturing purchasing managers this week having failed to turn the mood brighter. Services numbers are due today.
“UK PMI data is unlikely to be a game changer,” analysts from French bank Credit Agricole said in a morning note.
“Any better than expected reading may trigger some position squaring related upside in the pound. However, with rate expectations linked to long-term uncertainty and as fears of a hard Brexit remain intact, it seems unlikely that sentiment is changing to the better.”