Sterling slips as PMI points recession; election uncertainty sets in


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Sterling slips as PMI points recession; election uncertainty sets in

On Friday, the 22nd of November 2019, the British currency extended its losing streak for fourth straight day in a row and appeared to be well-poised to score a weekly plunge of more than 1 per cent, after surveys released on Friday (November 22nd) had shown that the British businesses were witnessing their worst economic downturn since June 2016, while an abrupt upsurge in supports for Labour’s Corbyn in the opinion polls ahead of a December 12th General Election had also weighed on to investors’ sentiment.

Besides, during preparation of the report, at late-afternoon European trading hours, sterling was trading 0.40 per cent lower to $1.2853 against its American counterpart following reveal of a much downscaled HIS Markit/ CIPS UK Purchasing Managers’ Index (PMI) that had shown a decline in both manufacturing and service sectors activity in Britain was accelerating in November, while a televised debate between the Tory’s PM Johnson and Labour’s Corbyn on Wednesday (November 20th), that seemed to have placed opposition leader Corbyn on a much-stronger footing, as he had been making a slew of pledges which addressed the Kingdom’s concerns, but PM Johnson had nothing to offer but a Brexit up until now, might have added strains on a faltering British currency which had been a lone indicator to the Brexit sentiment so far, suggested analysts.

Meanwhile, Purchasing Managers’ index for Britain in November, a critical indicator to investment appetite for businesses, was contracted to 48.3 from a previous figure of 49.6, while a figure of 50.0 differs a recessed economy from a expanding one, as a head of a global sales trading at Saxo Markets, Adam Seagrave said on Friday (November 22nd), “UK PMIs showed a deeper contraction than anticipated in the manufacturing sector which is another indication of something we all know – the UK economy is faltering. ”