The British pound gained today as the US dollar weakened following a sharp dip on Wall Street. The pound was strengthened by the latest IHS Markit manufacturing survey which showed that the sector maintained steady growth in March.
Sterling rose 0.2 per cent to $1.41 this morning. Against the euro, sterling was trading at 87p. The pound has had a strong performance since the British government secured a deal with the EU on its departure from the bloc. The Euro was up 0.18 per cent against the dollar.
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After China imposed tariffs on a number of US products, the dollar had fallen against the yen for the third straight day, but levelled out today as currency investors pulled back from the Japanese currency.
The S&P closed 2.23 per cent on Monday, its worst start to April since the Great Depression. The Nasdaq index closed down 2.74 per cent following a sharp decline in technology shares, while the Down Jones fell by 1.9 per cent.
Asian currencies like the Korean won, Taiwanese dollar, as well as the Australian dollar, which would normally fall sharply in response to a possible trade war, have all performed relatively well in recent days.
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The IHS Markit survey showed the UK’s Purchasing Managers’ Index (PMI) rose from 55 in February to 55.1 in March. Analysts had expect the survey to come in as low as 54.7. Still, the report suggested that manufacturing growth had slowed since the beginning of the year, with the opening quarter overall the weakest in a year.
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