Pound Declines Against US Dollar on UK GDP and Current Account Data

The British pound today declined against the US dollar after the release of the UK Q4 GDP data and the country’s current account data, which were published in the early European session. The current account deficit boosted the pair slightly by coming in lower than expected, while the GDP data did not provided the added boost to the currency pair as expected.
The GBP/USD currency pair today lost over 60 points to decline from a high of 1.4097 to a low of 1.4035.
The UK current account deficit released by the Office for National Statistics early in the European session boosted the cable as it was lower than expected. The deficit shrunk to £18.44 billion as compared to the expected £24.0 billion and the £22.8 billion recorded in the previous quarter. The final revision of the UK Q4 GDP print came in at 1.4% on an annualized basis meeting expectations, but had a muted impact on the currency pair. The total business investment in the UK during Q4 2017 was also higher than expected by coming in at 2.6% as opposed to the expected 2.1%.
The currency pair’s decline was further accelerated by increased buying interest in the US dollar following yesterday’s strong GDP data. Several releases from the US docket today including the PCE data released by the Bureau of Economic Analysis had minimal impact on the currency pair.
The currency pair’s future performance is likely to be affected by political events given the upcoming long weekend due to the Easter holiday celebrations.
The GBP/USD currency pair was trading at 1.4060 as at 14:23 GMT having declined from a high of 1.4097. The GBP/JPY currency pair was trading at 149.52 having dropped from a high of 150.43.

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