The UK Composite PMI in June (according to preliminary data) rose to 47.6 from 30.0 in May. This was the biggest ever monthly bounce in this indicator of economic activity in UK services and manufacturing, reflecting the partial easing of the domestic lockdown. However it was from a very low base and a figure below 50 still implies that more respondents saw economic activity decline than rise in the first three weeks of June.
This was materially stronger than the consensus forecast of 41.0 and yet Sterling’s reaction has been muted. In trade-weighted terms it is broadly unchanged from 24 hours ago.
The picture has been very similar in the Eurozone, with the Composite PMI jumping to a higher-than-expected 47.5 in June from 31.9 in May and yet the Euro has only appreciated incrementally in today’s session. A case of currency markets seemingly looking beyond data which they may already regard as “old”.
