On Wednesday, the release of the finalised manufacturing PMI in the UK confirmed that UK factory activity had slowed down, forcing the currency to struggle.
While it was revised slightly higher, the data aligned with the ongoing supply chain issues and staff shortages that have been caused by both increasing Covid-19 cases and Brexit. This was added to the concerns around the economic recovery in the UK, seeing the Pound finish at 1.1631 against the Euro and 1.3772 against the US Dollar according to the Foreign Exchange Market.
The Euro strengthened through yesterday’s session as there was an improvement in unemployment figures. This resulted in investors hoping for a more hawkish approach from the European Central Bank to the monetary policy, especially after the CPI release on Tuesday which also helped to bolster the single currency.
A drop in US Treasury yields caused the US Dollar to weaken yesterday while poor jobs data also heaped misery on the Greenback. The news that the US private sector hired just 374,000 new workers in August, which came under the 613,000 that was predicted, forcing the currency to lose some ground and weaken.