Latest data released by Markit - 1 October 2018
- Prior 52.8; revised to 53.0
The beat relative to expectations and revision may seem to be good on paper but the details isn't that pretty. Export orders recovered after the decline in August while output expanded at the fastest pace in four months. But overall factory activity remains subdued and according to Markit, "many UK manufacturers noted the backdrop of Brexit and a volatile exchange rate were making any forecasting activity increasingly difficult".
There isn't much of a reaction in the pound though. The quid did move higher prior to the data release and there hasn't been much of a reaction to this really.
GBP/USD holds steady close to 1.3050 while EUR/GBP remains near the lows at 0.8888. Given the Brexit backdrop, I don't expect the data here to produce a lasting reaction and the lack of a initial reaction pretty much says it all.
The data may have beaten expectations but in the bigger picture, it's lackluster and nothing to cheer about.
