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British Pound Drops on Brexit Uncertainty Amid Latest UK GDP Data

November 9, 2018 at 11:27 by Simon Mugo

A fan of Great Britain 10-pound notesThe British pound today declined against the US dollar as investors remained cautious towards the cable given the looming uncertainty over Brexit negotiations. The GBP/USD currency pair’s performance was also affected by the strong greenback as the US Federal Reserve reiterated its resolve to hike rates in December.

The GBP/USD currency pair today declined from an opening high of 1.3069 to a low of 1.2989 in the early European session.

The currency pair was on a downtrend during the Asian session, but traded flat in the early London session after the UK’s Office for National Statistics released a batch of macro data. The GDP growth data for September and the third quarter was the highlight of the event as it remained flat during the month missing expectations by 0.1%. The quarterly GDP growth print came in at 0.6%, which translated into an annualized 1.5%, as both prints met consensus estimates. Other relevant data points included the visible trade balance data for September, which was better than expected, and the industrial production data, which remained flat, missing expectations by 0.4%. The manufacturing production data and the construction output data both came in better than expected.

The currency pair was also weighed down by the looming uncertainty regarding the stalled Brexit talks as the UK government and the EU are yet to agree on a deal even as the 29 March 2019 deadline fast approaches.

The currency pair’s short-term performance is likely to be affected by the release of the US PPI and consumer sentiment data later today.

The GBP/USD currency pair was trading at 1.3018 as at 11:16 GMT having dropped from a high of 1.3069. The GBP/JPY currency pair was trading at 148.19 having declined from a high of 148.98.

If you have any questions, comments or opinions regarding the Great Britain Pound, feel free to post them using the commentary form below.

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