Pound Rallies on Upbeat UK GDP Report, Falls Ahead of Brexit Vote

The Sterling pound today inched higher against the US dollar boosted by the release of the upbeat UK Q3 GDP data in the early London session. The GBP/USD currency pair barely reacted to the appointment of a new Bank of  England Governor, which was expected by  most analysts and  investors.
The  GBP/USD currency pair today rose from an  opening low of  1.3007 to  a  high of  1.3048 in  the  mid-London session and  was near these highs at  the  time of  writing.
The  currency pair rallied from the  start of  today’s session amid optimism that the  new Conservative Party government will fast-track the Brexit process. News reports indicated that the British government wants to pass its Brexit bill by January 9th giving MPs only three days to debate and pass the bill. The release of the upbeat UK Q3 GDP report by  the  Office for  National Statistics also boosted the  pair. The  country’s GDP grew by  0.4% in  Q3, beating analysts expectations of  a  0.3% expansion. The  public sector borrowing report released at  the  same time also beat consensus estimates contributing to  the  pair’s gains. Investors barely reacted to  the  appointment of  Andrew Bailey as  the  next BoE Governor as  this was expected.
The  currency pair’s rally was limited by  Boris Johnson‘s announcement that the  Withdrawal Agreement Bill does not have a  provision for  an  extension of  the  Brexit talks past December 2020. Johnson said that the  move will strengthen the  UK’s negotiating position.
The  cable’s short-term performance is likely to  be affected by  the  outcome of  the  House of  Commons vote on  the  bill at  15:00 GMT.
The  GBP/USD currency pair was trading at  1.3025 as  at  12:10 GTM having fallen from a  high of  1.1048. The  GBP/JPY currency pair was trading at  142.44 having dropped from a  high of  142.75.

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

Be First to Comment

Leave a Reply

Your email address will not be published. Required fields are marked *