Pound falls as UK manufacturing decelerates

Posted On: January 02, 2015

The pound fell 1 percent Friday to 1.5424 per U.S. dollar, Bloomberg reported. Earlier in the trading session, the currency declined to 1.5413 per U.S. dollar, which marked its lowest rate since August 2013. The pound also fell 0.5 percent to 78.08 pence per euro after a 6.5 percent upswing against the common currency in 2014.

The publication noted that the pound hit its lowest level in more than a year following a report indicating the deceleration of U.K. manufacturing in December.

"The pound fell today as the manufacturing PMI report was consistent with the latest trend in the U.K. data showing recovery but a declining pace compared with market expectations," Athanasios Vamvakidis, head of Group of 10 currency strategy at Bank of America Corp. in London, told Bloomberg.

Reuters reported that the Markit/CPS UK Manufacturing Purchasing Managers' Index sat above the 50 threshold, which points to growth in the sector. However, manufacturing nonetheless slowed. The news source also noted that lending to British consumers recently hiked to its swiftest rate in nearly a decade.

Neil Mellor, a currency strategist with Bank of New York Mellon, told Reuters that the Bank of England will not likely raise interest rates anytime soon.

Category: Industry News

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