The Great Britain pound weakened today, falling against the US dollar and the Japanese yen, while erasing its earlier gains versus the euro. The losses followed that data that showed very slow growth of the UK services industries.
The services Purchasing Managers’ Index fell from 52.2 in September to 50.6 in October. The index still indicates growth, but the rate of expansion was slowest in 22 months. Analysts have expected the gauge to fall just a little to 52.0.
The poor data added to concerns that the growth in the third quarter was just temporary and the UK economy may slip back into recession. The Bank of England holds a policy meeting November 8. While the BoE is not expected to add stimulus on this week’s meeting, unfavorable economic reports spur speculations that the central bank may refer to easing later. Such talks are not supportive for the sterling.
GBP/USD fell from 1.6008 to 1.5978 and GBP/JPY dropped from 128.75 to 128.27 as of 22:22 GMT today. EUR/GBP was little changed from its opening level of 0.8002, while it fell to 0.7983 earlier.
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