FXStreet (Guatemala) - Marc Chandler, Global Head of Currency Strategy at Brown Brothers Harriman explained that the UK services reading rose well above expectations to 59.1.
“This is an eight month high."
"The consensus had expected a small improvement from the 57.7 reading in June. Given the significance of the service sector, it more than offsets the modest disappointment seen in the manufacturing PMI (55.4 down from a revised 57.2)."
"The robust report lifted UK interest rates 2-3 basis points (short and long end) and lifted sterling back the highs seen before last weekend just below $1.69.
"Some caution is evident. Although the BOE meetings on Thursday, no one expects a hike, though the Shadow MPC has called for a 50 bp hike."
"Some observers expect a dissent or two, but these will not be evident until the minutes are released on August 20. There may also be some hesitancy ahead of televised debate later today on the Scottish referendum."