Expectations about Britain's economy coming out of recession faster than what economists expected resulted in rise of Sterling value against the US dollar, signifying a five-month high.

Sterling rose 0.8 percent to $1.5816 after a report revealed that U.K. manufacturing expanded for a tenth straight month in July.

From Guardian.co.uk:

The Markit/Chartered Institute of Purchasing and Supply (CIPS) manufacturing PMI fell to 57.3 in July, from 57.6 in June, above forecasts of 57.0.

Britain's resurgent manufacturing sector has helped boost economic growth and business surveys have suggested activity is at its highest in more than a decade as factories rush to meet rising demand at home and abroad.

Jane Foley, research director at Forex.com, said: "The expansion in July was better than expected and in so far as the market is expecting the pace of UK growth to moderate in H2 as austerity bites, today's data settled a few nerves."

The euro also rose against the US dollar, adding 0.2 percent to $1.3078.

Source: http://www.guardian.co.uk/business/marketforceslive/2010/aug/02/1