On Wednesday the pound sterling traded higher vs the greenback after data
showing the U.K. service sector output grew at a faster than expected
rate in January after slowing at the end of last year.
The pair GBP/USD was trading at 1.5197, up from around 1.5160 ahead of the data.
Research group Markit concluded the services purchasing managers’ index rose to 57.2 last month, recovering from a 17-month low of 55.8 in December and well ahead of forecasts of 56.3.
Pointing to an upturn in job creation, there was also a rise in the employment component of the index.
The report showed, however, that inflation pressures remained subdued, underlining expectations that the Bank of England will leave interest rates on hold until early 2016.
The pound was also higher against the more vulnerable euro, with EUR/GBP down 0.42% to 0.7536.
Sentiment on the single currency was hit by fresh concerns over Greece, following reports that the European Central Bank is unwilling to back government plans to renegotiate the terms of the country’s €140 billion bailout.
Meanwhile in the eurozone, data released Wednesday indicated that the euro zone private sector expanded at the fastest pace in six months in January, as economic activity accelerated.
The euro zone composite PMI, which measures activity in the manufacturing and services sectors, rose to 52.6 up from a preliminary estimate of 52.2 and a final reading of 51.4 in December.
Output growth expanded in Germany, Italy and Spain, but the downturn in the French economy extended into its ninth month. Euro zone retail sales rose 2.8% in December from a year earlier, according to another report, - the strongest increase in nearly eight years.
