LONDON, Sept 5 Reuters A deteriorating global growth picture sent the pound to a 12week low against the dollar on Tuesday after a survey showed business activity in Britain contracted last month.

The UK SP GlobalCIPS composite Purchasing Managers39; Index PMI dropped to 48.6 in August from 50.8 in July, the lowest since January, although it was revised up from an earlier estimate of 47.9. The services sector PMI printed at 49.5, below the half century mark that separates growth from contraction.

The forwardlooking indicators in today39;s services survey remained downbeat as companies reported a slight decline in new business, said Martin Beck, chief economic advisor to the EY Item Club.

The more dovish signals from today39;s survey are consistent with the … view that we are now close to the end of the current monetary tightening cycle.

The Bank of England, which has raised its key interest rate 14 consecutive times to 5.25, is expected to go ahead with a 25 basis point rate hike later this month.

Markets are pricing in another hike after that to 5.75 by early next year even as other major central banks, such as the U.S. Federal Reserve and European Central Bank, appear close to the end of their respective tightening cycles.

Even though rate pricing has come back from the peak, there39;s still the risk that the Bank of England delivers less hiking than the market is priced for, said Adam Cole, chief currency strategist at RBC Capital Markets.

When there39;s a…