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UK Economy Again Surprising to Upside as Services PMI Beats Forecasts

Yesterday, I wrote about the UK data showing a better than expected release from the construction sector, and it followed that up by now posting a better than expected Services PMI report. The index came in at 62.5 for October, a full 2.2 points higher than the 60.3 expected, and has given a big injection of demand into GBP across the board as it means that the expectations around when the BOE will tighten policy is moved closer.

Here's a look at how the PMI looks over the recent past:

Some highlights include new business growth expanding at the fastest pace since Markit started running this survey 17 years ago. The backlog of work and employment both increased markedly as well.

This is the type of report that will leave an impression and it may be prudent to take a close look at GBP pairs (like we did with the EUR/GBP yesterday) and see if there are opportunities to pick up the GBP in pairs in which it was sold recently.