European session review: GBP weakens against most major counterparts after gloomy UK’s PMI data

GBP depreciated against most other major currencies in the European session on Friday, weighed down by UK's March PMI data. The sterling weakened against USD, EUR, JPY, CHF and CAD, but it rose against AUD and NZD.

The report from IHS Markit and Chartered Institute of Procurement & Supply (CIPS) showed on Friday that the final UK Composite Output Index, covering the country's manufacturing and service sectors, dropped sharply from 53.0 in February to 36.0 in March, the lowest level since this series began in January 1998. The latest figure was below the earlier "flash" reading of 37.1 in March and also pointed to a slightly quicker decrease in the UK's private sector output than that recorded at the height of the global financial crisis (index at 38.1 in November 2008). According to the report, the slump in overall business activity was driven by a record fall in service sector activity, alongside the fastest drop in manufacturing production since July 2012.

The UK's March PMI data added to the increasingly grim economic statistics reported recently across the developed world as the countries' measures to fight the COVID-19 pandemic hurt business operations and trigger job losses.