Pound Drops Even as Trade Deficit Shrinks

The Great Britain pound dropped today, reaching the lowest level since September against the US dollar, even after data showed that Britain’s trade deficit shrank more than expected in September.

The UK trade balance posted a deficit of £8.4 billion in September (seasonally adjusted), compared to the analysts’ estimate of £9.1 billion. The quarterly deficit was £8.5 billion in the third quarter of 2012, down from £10.1 billion in the previous quarter. The Conference Board leading index rose 0.2 percent in September, showing the same rate of growth as in August. The macroeconomic data was good, but that did not deter the sterling from falling.

GBP/USD dropped from 1.5981 to 1.5924 as of 14:36 GMT today, while its daily minimum of 1.5903 was the lowest since September 6. GBP/JPY slumped from 126.99 to 126.31, reaching 125.93 intraday — the lowest price since October 15.

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