The latest economic data from the UK, specifically the Services Sector PMI survey which was produced by Markit Surveys, showed an improvement in the June numbers with a reading of 55.1 against an expected flat reading of 54.0. That has helped to push the Pound Sterling higher as FX traders ponder the growing possibility that the Bank of England might now reconsider a summer interest rate hike. Though the first half of 2018 was generally sluggish, the surveys produced this week have all beat analysts' forecasts, a sign that the UK economy might be pulling out of the doldrums.

As reported at 11:10 am (BST) in London, the GBP/USD was trading higher at $1.3214, a gain of 0.18% and off the session peak of $1.3228; the recorded low for the session is at $1.3171. The EUR/GBP is trading at 0.88042 Pence, a loss of 0.36%; the pair has ranged from a trough of 0.88032 Pence to a peak of 0.88406 Pence.

New Calls for BoE Rate Hike

Given the latest PMI data, markets are now pricing in an August rate hike at 53% and a 25 basis points increase by year's end at 88%. Moreover, upwardly revised GDP data for the first quarter suggests that the slowdown in the first quarter wasn't as bad as initially thought. Andy Haldane, the Bank of England's chief economist, recently added his voice to the growing calls by two hawkish members of the Monetary Policy Committee, for a rate increase.