The Pound has taken a bit of a tumble this morning, following the release of UK Manufacturing and Services PMI data. This was the first chance to see what effect Brexit would have on the real economy, as the figures were for July, after the vote.
The number was the sharpest decline in 7 years, and shows a sharp downturn in the manufacturing sector. Here is how it affected the GBP/EUR rate:
The rate had climbed up to around €1.2040, but as soon as the numbers were released, you can see that it has fallen nearly 1 cent, but in the grand scheme of things it’s not really too bad; the GBP/EUR rate is simply back down to where it was yesterday lunchtime.
I think it’s a bit of a knee-jerk reaction to be honest, and I think that the rate will bounce back to around the €1.20 mark if not today then early next week, but any further gains are likely to be limited by fears that further economic figures, when they come, will also show the economy is suffering.