GBP/USD Volatility Eases Amid Mixed UK Data

The British Pound (GBP) has experienced mixed data, but remains supported against the US Dollar (USD). According to Brown Brothers Harriman's (BBH) Elias Haddad, the GBP/USD is firmer due to broad USD weakness despite disappointing UK Retail Sales and a lower Manufacturing PMI. However, the Services PMI rose from 54.6 to 56.8 in August, crushing estimates of 54.

The pound has dipped slightly against the dollar, trading at 1.3626, down 0.02%, but is poised to end the week with gains of over 0.60%. Haddad notes that market pricing of 50 bps Bank of England (BoE) hikes over twelve months as too aggressive, although the UK's growth-inflation mix still supports the Pound.