UK manufacturing PMI unexpectedly ticked up to 55.1 - BBH

The UK offered a pleasant surprise, and it has helped underpin sterling and UK rates as the manufacturing PMI unexpectedly ticked up to 55.1 from a revised 54.2 (was 54.3) in June, notes the analysis team at BBH.  

Key Quotes

“It snaps a two-month decline.  Exports were particularly strong and appeared to be the second highest reading since 1992 when the surveys began.  On the other hand, sterling's past decline appears to be dropping out of some price measures, as input prices were at their lowest in over a year.”

“The Bank of England meets on Thursday.  While no one expects a hike, there is some debate over the guidance to be given in the Quarterly Inflation Report.  We suggest that this provides room to negotiate.  Haldane is seen as a swing vote, whether it is by 6-2 or 5-3.  Keeping Haldane with the majority may require more hawkish rhetoric.”