Once again, the GBP finished the day as top performer amongst the FX majors with 100+ pip gains for GBP/AUD, GBP/NZD and GBP/CAD. The pound broke above last Thursday’s 1.3274 high just ahead of the 4pm month-end ‘fix’ in London and the regulators might well be pleased to see this wasn’t the type of ‘pump and dump’ price action which has brought the wholesale FX market into such disrepute over the past few years. Instead, the pound held on to its gains for long enough to quell any lingering suspicions and though it subsequently gave back some ground, this can legitimately be explained as profit-taking ahead of a rate-hike decision on Thursday which is pretty much 100% fully discounted. As the new month begins, so it’s that time when we look forward to the release of Purchasing Managers Indices around the globe. China kicked off on Tuesday with disappointing manufacturing and service sector numbers and after Australia first thing this morning, it will be the turn of the UK and US to report on manufacturing later today before the Eurozone numbers on Thursday. The UK has actually been quite resilient over the last few quarters with healthy external demand for UK products offsetting a somewhat weaker domestic picture. The read-across into FX ought to be straightforward (famous last words!) and with a consensus of 55.8 for Octobers survey after 55.9 in September, a beat/miss on the number should push GBP up/down.