The British pound showed resilience on Tuesday in the face of data showing the fastest decline in UK manufacturing orders in three years. Pound uncertainty prevails, however, and a vote of no confidence in British P.M. Theresa May draws closer.
New orders in the UK’s manufacturing sector fell by 6 percent in the three months to October, the Confederation of British Industry announced on Tuesday.
In its press release, the CBI, which collects data and opinions from 354 UK manufacturers, also expressed expectations among business managers for output growth to fall between now and the end of January 2019.
The pound showed resilience in the aftermath of the CBI report’s release, as it weakened only marginally, by 0.1 percent, to respective dollar and euro rates of $1.299 and €1.132.
Key quotes from the CBI include those made by the group’s chief economist Rain Newton-Smith, who described a “sobering set of figures” that demonstrate that UK investments are being “scaled back in the face of deepening Brexit uncertainty.”
“It is not surprising,” says CBI Manufacturing Council Chairman Tom Crotty, “that many firms have recently moved publicly from contingency planning to action as the likelihood of a ‘no deal’ Brexit increases.”
With speculation mounting that 1922 Committee Chairman Sir Ian Brady is nearly in receipt of the 48 letters needed to trigger a vote of no confidence in Prime Minister Theresa May, sterling will likely remain under a cloud for the time being.
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