Sterling near 11-month highs before UK construction PMI data

LONDON (Reuters) – Sterling traded near a 11-month high on Wednesday, as traders eyed a survey of the construction sector for the latest steer on Britain’s struggling economy.

The pound climbed to as much as $1.3245 against a broadly weaker dollar on Tuesday, its highest after the purchasing managers’ index (PMI) for the manufacturing sector came in stronger than expected, helped by robust export growth.

“With UK manufacturing growth rebounding from a seven-month low in July, some fears have receded over a deceleration in economic momentum and this was reflected in sterling’s appreciation,” said FXTM research analyst Lukman Otunuga.

“Although sterling has started the trading week on a firm footing, with Tuesday’s positive economic data keeping the currency buoyed, the key driver behind the pound’s resurgence remains dollar weakness.”

It was close to that high on Wednesday, up a quarter of a percent on the day at $1.3236.

Against the euro, the pound was flat at 89.41 pence.

The PMI survey for the construction sector was due at 0830 GMT, and was expected to show a modest slowdown in activity.

Reporting by Jemima Kelly; Editing by Saikat Chatterjee

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