- Pound (GBP) rises after losses yesterday
- UK services PMI rose to 52.3
- Euro (EUR) is falling despite upbeat data
- Eurozone composite PMI grows at fastest pace in 2 years
The Pound-Euro (GBP/EUR) exchange rate is rising after losses yesterday. The pair fell -0.57% in the previous session, settling on Tuesday at €1.1341. It traded between €1.1334 and €1.1414. At 17:00 UTC, GBP/EUR traded 0.14% at €1.1357.
The pound is rising, boosted by data that showed the UK service sector activity continued to strengthen in October. The SMP global UK services PMI rose to 52.3 last month up from 50.8 in September. This was an upward revision from the preliminary reading of 51.1, and it was welcome news for the chancellor ahead of her budget this month.
The service sector, which accounts for over 80% of the UK economy, noted resilient consumer demand, while labour market conditions also showed some signs of stabilisation.
Meanwhile, the composite PMI, a good gauge of economic activity that also includes the manufacturing reading, jumped to 52.2 in October, up from 50.1 in September.
The data comes ahead of tomorrow’s Bank of England rate decision, while the central bank is widely expected to leave rates unchanged at 4% on Thursday.
The euro is falling despite PMI figures showed the economy grew at the fastest pace in more than 2 years. The eurozone composite PMI, considered a good gauge of business activity, climbed to 52.5 in October, up from 51.2 in September, marking a tenth straight month of growth and reaching its highest level since May 2023.
The service sector saw a solid upswing last month with new business volumes expanding at the fastest pace in 2 1/2 years. The services PMI rose to 53 in October, up from 51.3 in September and reaching a 17-month high.
Delving deeper into the figures, Spain led the pack with a sharp increase to 56, its best performance in 10 months, while Germany’s economy also showed surprising strength.
On the downside, France was a weak performer and the only major eurozone economy in contraction territory.