Decorating the market at today’s European session was the publication of manufacturing and services data from the European Zone and the UK which showed mixed readings recorded in January.
Preliminary estimates from the IHS survey show that European Zone manufacturing activity grew higher than expected this month, with an increase of 59.0 from 58.0 previously recorded and exceeding expectations for an increase of 57.6.
This positive growth was supported by a modest surge in manufacturing activity in Germany which showed some significant resilience to start the new year with a jump to a five -month high.
However, in contrast to the services sector which continued to show a decline in January, declining to a 9 -month low of 51.2 from 53.1, due to the impact of the contagion of the Omicron variant.
This mixed figure caused the euro currency to change slightly to trade at around 1.1333 against the USD.
Meanwhile, the expansion of UK economic activity was not as good as expected as both the manufacturing and services sectors posted disappointing readings.
Growth in UK manufacturing activity slowed slightly this month, with only recording an expansion of 56.9 from 57.9 recorded the previous month. Meanwhile, the services sector was slightly off expectations and also showed a slight decline.
This decline proves economic activity in the UK is actually burdened by the spread of Omicron although the government is seen not to be concerned about the threat of this new variant.
The pound's initial reaction showed that the currency continued to extend its decline to around 1.3530 and was also affected by the strong USD ahead of this week's FOMC policy meeting.
