Sterling sticks above US$1.25 ahead of PMI data

The pound gained 0.2 per cent against the dollar. — AFP pic
The pound gained 0.2 per cent against the dollar. — AFP pic

LONDON, Dec 1 —  Sterling held firm above US$1.25 (RM5.59) today, having recorded its best month of gains against the dollar since March and its best month against the euro since 2009.

Analysts said a survey of Britain’s factory output due at 0930 GMT was unlikely to impact the pound significantly, with some questioning whether a broad rally in the dollar has any further to run until detail of president-elect Donald Trump’s pro-growth policies are unveiled.

Economists polled by Reuters expect Markit’s Purchasing Managers’ Index (PMI) of manufacturing companies to hit 54.5 in November, a shade higher than last month’s 54.3.

Another factor supporting the pound has been signs that investors are reducing short positions on the currency that surged after Britain’s vote to leave the European Union in June.

Sterling net shorts fell for a second straight week to 74,318 contracts, data showed on Monday.

“The most likely outcome is that volatility continues to fall and the pound drifts in a range against the dollar, with EUR/GBP reflecting the European political mood, which in turn gives GBP/USD a bearish bias overall,” Societe Generale strategist Kit Juckes said.

The pound gained 0.2 per cent against the dollar to trade at US$1.2535, and was a touch up against the yen and the euro. — Reuters

Related Articles

Up Next