The British pound today rallied higher against the US dollar after the release of UK preliminary GDP data for the fourth quarter of 2017. The GDP report indicated that the UK economy grew at an accelerated pace beating expectations, which triggered the rally.
The GBP/USD currency pair gained over 135 points from its opening low of 1.4146 to hit a high of 1.4285.
The currency pair begun its recovery from yesterday’s losses in the Asian session, which gathered momentum in the early European session after the Office for National Statistics released the UK’s Q4 GDP report. According to the report, Britain’s GDP grew by 0.5% in the fourth quarter, which was higher than the expected 0.4% growth rate. The GDP also grew by 1.5% on an annualized basis in the quarter, which was better than the consensus estimate of 1.4% growth. The country’s full year GDP growth for 2017 also came in at 1.8%.
The currency pair was on a recovery from yesterday’s slump triggered by the US dollar’s resurgence after President Donald Trump reiterated his support for a strong US dollar. President Trump took back US Treasury Secretary Steven Mnuchin‘s comments stating that a weak dollar was good for the USA. Munchin’s statements drew the ire of ECB President Mario Draghi and International Monetary Fund Managing Director, Christine Lagarde.
The currency pair’s future performance is likely to be affected by the release of US advance goods trade balance, US Q4 GDP report and durable goods orders, all scheduled for later today.
The GBP/USD currency pair was trading at 1.4239 as at 13:10 GMT having rallied from a daily low of 1.4146. The GBP/JPY currency pair was trading at 155.66 having risen from a low of 154.91.
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