GBP Climbs after UK Data, British GDP Growth Estimate Ahead10 November 2017 by FC Exchange
The pound had the opportunity to register gains against other currency majors on Friday morning, but the upcoming UK GDP growth estimate could create further fluctuations as the session continues, say currency experts, FC Exchange.
The pound had the opportunity to climb against other currency majors on Friday after a mixed bag of UK economic data reached the market. The pound to euro (GBP/EUR) exchange rate briefly breached the 1.13 mark, the pound to Australian dollar (GBP/AUD) exchange rates hovers around 1.71, while the sterling to US dollar (GBP/USD) exchange rate resides at levels of 1.31.
While UK construction output fell further than forecast to 1.1% in September on the year from 3.9%, the UK’s industrial sector noted growth, climbing from 1.8% to 2.5%. Manufacturing production also only slipped slightly from 2.8% to 2.7%, despite economists expecting a larger fall.
In addition, the UK’s trade deficit narrowed in September, and August’s trade gap has also been positively adjusted lower. The gap between British imports and exports dropped to only £2.75 billion in September as UK exports to Europe picked up.
The Office for National Statistics said: ‘The increase in imports of unspecified goods (including non-monetary gold) and fuels from non-EU countries represents the largest increase in import commodities, alongside increases of mechanical and electrical machinery, material manufactures and fuel imports from EU countries.’
Later in the session, a UK growth estimate will emerge which could have an influence on the British currency. The UK political scene has experienced some unfortunate twists of late with Theresa May losing two ministers in the space of a week. Additionally, Brexit negotiations seem to be making little progress, leaving German firms to weigh in on the debate suggesting a hard Brexit is likely. Prime Minister Theresa May will begin a fresh round of talks in Europe on Monday.
Meanwhile, the Reserve Bank of Australia (RBA) cut its growth forecasts by 25 percentage points, while stating that the economy was likley to miss its inflation target for the fourth consecutive year, which offered the Aussie little support.
Disclaimer: This economic update is provided by FC Exchange a Global Reach Group Company, industry leaders in foreign exchange. Authorised affiliates are permitted to reuse content.
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