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Sterling fell in price on Wednesday, February 22, after strengthening 0.6% against the US dollar and keeping stability against the Euro. S&P Global/CIPS UK Composite Purchasing Managers’ Index unexpectedly bounced, increasing the concern about the prolonged recession. Experts are also concerned that the Bank of England (BoE) might keep rates higher for longer.
The PMI published the data after stronger-than-expected retail sales, but the main focus of the experts and markets in Northern Ireland after Brexit and its trade agreement impasse. Consumer reticence remains relatively high.
Britain and the European Union have long disputed the Northern Ireland protocol. This document regulates the post-Brexit trade with the province and aims to avoid developing a hard border of Ireland with EU members and to ensure a single market. However, they are still in dispute.
Money markets now predict that the Bank of England will raise the rates by a further quarter of a percentage point on March 23. Economists expect that UK rates will rise even higher in 2023.