Forex - GBP/USD slips lower after U.K. GDP, current account data

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Investing.com - The pound slipped lower against the U.S. dollar on Thursday, after data showed that the U.K. economy expanded in line with expectations in the last quarter, while uncertainty over the Federal Reserve's next policy moves continued to weigh.

GBP/USD hit 1.6036 during European morning trade, the session low; the pair subsequently consolidated at 1.6039, shedding 0.26%.

Cable was likely to find support at 1.5893, the low of September 18 and resistance at 1.6146, the high of September 19.

Official data showed that U.K. gross domestic product expanded by 0.7% in the second quarter, in line with market expectations.

On a yearly basis, U.K. GDP rose 1.3% in the three months to June, compared to expectations for a 1.5% increase.

A separate report showed that the U.K. current account deficit narrowed less-than-expected in the last quarter, improving to GBP13 billion from a deficit of GBP21.8 billion in the three months to March.

Analysts had expected the current account deficit to narrow to GBP12 billion in the second quarter.

Meanwhile, investors were eyeing the final reading of U.S. second quarter GDP due later in the day, after a recent string of economic reports underlined concerns over the outlook for the U.S. economic recovery.

Stronger-than-expected GDP data would likely fuel speculation that the Fed could announce a stimulus reduction before the year end.

Last week, the Fed said it wanted to see more evidence of a sustained economic recovery before it reduced stimulus.

Sterling was also lower against the euro with EUR/GBP adding 0.11%, to hit 0.8420.

Later in the day, the U.S. was to release the weekly report on initial jobless claims, as well as final data on second quarter growth and private sector data on pending home sales.


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This article appears in: Investing , Forex and Currencies

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