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Weekly roundup: Pound slumps in spite of robust GDP figures

currency-newsWeekly roundup: Pound slumps in spite of robust GDP figures
The pound traded in a fairly narrow range through a large part of last week’s session, as an absence of notable UK economic releases left Sterling without any strong directional bias.

On the other hand, the lifting of most remaining coronavirus restrictions in Scotland at the start of the week, helped to limit the downside in Sterling.

GBP exchange rates then came under some aggressive selling in the wake of the UK’s latest GDP release.

While the preliminary estimate for the second quarter reported UK economic growth rebounded by a solid 4.8%, lacklustre accompanying business investment figures as well as a dialing back of Bank of England (BoE) tapering expectations, weighed heavily on Sterling sentiment

So far this week the pound has faced significant headwinds, with GBP investors shrugging off an upbeat UK jobs report.

Also in the spotlight for GBP investors this week will be the UK’s latest consumer price index, in which an expected slowing of inflation last month could extend the decline in the pound as it further dampens BoE tapering expectations.

Closing out the week will be the publication of last month’s domestic retail sales figures, which could revive GBP demand if sales growth exceeds expectations.
Philip McHugh

Philip McHugh

Joining the corporate trading desk in 2007, Phil now over sees all of Currencies Direct’s corporate dealing activity. Having gained experience working with hundreds of businesses to optimise international payments processes and execute comprehensive risk management strategies, Phil currently works with a portfolio of corporate clients whilst managing Currencies Direct’s overall market exposure

Phil has FCA approval and has completed the Certificate in International Treasury Management (CertiTM)

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