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Economics

Pound Outlook Darkens as First Signs of Brexit Fallout Emerge

  • U.K. services, manufacturing industries contract in July
  • Citi U.K. Surprise index falls from highest in almost 3 years

The pound’s recent resilience may prove short-lived as data showed the first indications that the U.K. economy may be faltering one month after Britain voted to leave the European Union.

Inflation and labor figures covering the pre-Brexit period, released earlier this week, beat analyst predictions and helped the currency climb from a 31-year low versus the dollar set on July 6. That rally ended Friday after purchasing managers’ index reports, which included the period following the June 23 referendum, suggested the U.K.’s manufacturing and services industries contracted this month.