Euro Surges Against Pound as UK Business Activity Slows Amid Inflation Pressures
The Euro has rallied against the British Pound as UK business activity slowed in September due to higher inflationary pressures. The EUR/GBP pair hit session highs at 0.8590, drawing closer to the top of the monthly range at 0.8600.
According to preliminary UK S&P Global Purchasing Managers' Index (PMI) data, manufacturing activity improved to 52.0 in September from 51.7 in August, but services activity slowed down to 51.7 from 52.5 in the previous month, below market consensus.
The report highlights that input price inflation accelerated for the second month running to its highest since June, with survey respondents complaining about increased energy, fuel, and raw material costs.
In contrast, Eurozone data has been more supportive, with the Preliminary Eurozone Services PMI improving to 53.0, beating expectations of a 51.7 reading, while Manufacturing PMI remained steady at 52.7.