A sharp fall in equities yesterday saw the pound tumble vs dollar

Sterling dropped over a cent to its lowest point in 6 weeks against the greenback yesterday following a combination of falling equity prices and weak economic data.

• The pound erased early gains against the greenback yesterday after an unexpected dip in UK manufacturing activity in August, stoking concerns about the pace of the recovery in the British economy.
  
• Many analysts thought the data represented only a temporary setback for a recovery, given the continued support of stimulus spending, but investors appeared more concerned about the implications for interest rates and monetary policy.
  
• Sterling also came under pressure in the wake of poor equity prices which failed to follow the rally in many of the Asian stocks.
  
• Additionally, in the US, data was revealed that the manufacturing industry expanded for the first month in over a year, producing a figure of 52.9. The figure failed to have a positive effect on sterling, which closed the day at $1.6157.
  
• In the US today, there is a string of economic data released, including non-farm employment change at 13:15BST.