EUR/GBP hovers around 0.8650 following PMIs from UK, Eurozone

• EUR/GBP moves little after the release of Purchasing Managers’ Index data from both economies.
• The S&P Global UK Manufacturing PMI declined to 47.3, while the Services PMI unexpectedly jumped to 53.6 in August.
• The HCOB Eurozone Manufacturing PMI rose to 50.5 in August, while the Services PMI slipped to 50.7.

EUR/GBP remains steady after registering gains in the previous session, trading around 0.8660 during the European hours on Thursday. The currency cross moves little following the release of mixed S&P Global UK Purchasing Managers’ Index (PMI) data.

The preliminary S&P Global UK Manufacturing PMI declined to 47.3 in August from 48.0 in July. The data missed the anticipated 48.3 print in the reported period. Meanwhile, UK Services PMI unexpectedly jumped to 53.6 from 51.8 prior, surpassing the market forecast of 51.8. Composite PMI climbed to 53.0 from the previous reading of 51.5, coming above the 51.6 expected.

Chris Williamson, Chief Business Economist at S&P Global Market Intelligence, quoted that “The flash UK PMI survey for August showed that economic growth has continued to accelerate over the summer following a sluggish spring, with the pace of expansion reaching a one-year high. The services sector has driven the upturn, while manufacturing also displayed further signs of stabilization.”

In the Eurozone, HCOB Manufacturing Purchasing Managers Index climbed to 50.5 in August from 49.8 in July, beating the market expectations of 49.5. Meanwhile, the HCOB Services PMI dropped to 50.7 from 51.0 prior, falling slightly short of the expected 50.8 reading. The HCOB Eurozone PMI Composite came in at 51.0, against the previous 50.9 and expected 50.7 readings.

The HCOB Preliminary German Composite Output Index arrived at 50.9 in August vs. 50.6 in July and 50.2 expected. The index was at its highest level in five months. Meanwhile, the Manufacturing PMI improved to 49.9 from 49.1 prior, beating the market consensus of 48.8. Services PMI fell to 50.1, against the expected 50.3 and previous 50.6 readings.

The downward pressure on the Euro (EUR) could ease as the Eurozone Manufacturing PMI indicated that the sector's activity returned to growth after a long period of contraction. Earlier, preliminary data from France and Germany signaled moderate improvements in business activity, helping to offset the weaker-than-expected Eurozone Services PMI.