The Pound Sterling climbed to its strongest level in five-years against the US Dollar on Thursday following the release of better-than-forecast UK manufacturing and house price data, the ‘Greenback’ meanwhile fell as yesterday’s weak US GDP data weighed.
Sterling strengthened following the release of Markit’s latest manufacturing purchasing manager’s index which jumped to 57.3 in April, up from the 55.8 recorded in March. Market analysts had been expecting the data to show that manufacturing slipped to 55.4.
Any figure above 50 indicates expansion.
Growth increased across the sector, as firms reported a rise in new orders, and new product launches. Manufacturers also took on more staff, with employment rising for the twelfth consecutive month.
“UK manufacturing continued its surging start to 2014, with output growth accelerating in April to a level among the highest signalled over the past two decades. This places the sector perfectly to build on the robust 1.3% expansion in manufacturing production reported by the first estimate of Q1 GDP. The output index from the PMI survey suggests manufacturing output growth in the second quarter may even breach 1.5% on its current tack,” said Rob Dobson, senior economist at Markit.
The Pound to US Dollar (GBP/USD) exchange rate is currently trading around 1.6902.
The data also adds to evidence that the UK economic recovery is broadening and is less reliant on consumer spending. The data also raised expectations that UK manufacturing output could accelerate more than 1.5% in the second quarter of the year.
Adding further support to the Pound was data which showed that UK house prices advanced by 1.2% in March. On a year by year basis prices surged by 10.9%, the biggest annual gain recorded since June 2007.
Following the release of the data the Pound also edged higher against the Euro.
Pound (GBP) Exchange Rates
[table width=”100%” colwidth=”50|50|50|50|50″ colalign=”left|left|left|left|left”]
Currency, ,Currency,Rate ,
Pound Sterling,
,US Dollar,1.6902 ,
Pound Sterling,,Euro,1.2175 ,
Pound Sterling,,Australian Dollar,1.8204 ,
Pound Sterling,,New Zealand Dollar,1.9576 ,
US Dollar,,Pound Sterling,0.5917 ,
Euro,, Pound Sterling ,0.8214 ,
Australian Dollar,, Pound Sterling ,0.5490 ,
New Zealand Dollar,,Pound Sterling,0.5106 ,
[/table]
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