Analysts at Rabobank noted that cable has climbed almost 4% since its August low with most of that bounce being triggered by the latest round of PMI data. 

Key Quotes:

"After the initial wobble in confidence, the majority of post-referendum UK survey data has demonstrated a remarkable pullback. That said, indications on investment have not been so stellar and this suggests that sterling could still be in for a rocky ride.

Comments from President Obama at the weekend that the US is in no rush to negotiate a trade deal with the UK and remarks from the former SNB President Hildebrand that it is wrong to think that negotiating a Swiss style deal with the EU for financial services are both reminders of the long, arduous and uncertain backdrop for the UK’s Brexit negotiations. 

Although the UK currently looks to be side stepping a post-referendum recession, political uncertainty can be expected to weigh on investment and growth into the medium-term. We continue to expect a weaker tone to GBP/USD medium-term and look for a move towards 1.27 on a 6 mth view."