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Forex - GBP/USD holds steady after U.K. GDP data

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Investing.com -

Investing.com - The pound held steady against the U.S. dollar on Friday, hovering close to four-month lows after preliminary data showed that the U.K. economy grew in line with expectations in the last quarter.

GBP/USD hit 1.6699 during European morning trade, the session high; the pair subsequently consolidated at 1.6697, inching up 0.06%.

Cable was likely to find support at 1.6658, Thursday's low and resistance at 1.6778, the high of May 30.

Sterling showed little reaction after official data showed, in a second estimate, that U.K. gross domestic product grew 0.8% in the second quarter, in line with market expectations.

Year-on-year, the U.K. GDP expanded at a rate of 3.2%, compared to expectations for 3.1% growth.

But demand for the pound remained under pressure after the Bank of England cut its wage growth forecast for this year in half on Wednesday and said that the rate of pay growth would be a key factor in determining how quickly interest rates will rise.

Sterling was lower against the euro, with EUR/GBP adding 0.11% to 0.8019.

Sentiment on the euro remained fragile after preliminary data on Thursdsy showed the euro zone economy failed to grow in the three months to June.

The weak data indicated that the economic recovery in the euro area is losing momentum, adding to pressure on the ECB to do more to shore up growth after it cut rates to record lows in June.

Later in the day, the U.S. was to release reports on manufacturing activity in New York state and industrial output, as well as preliminary data on consumer sentiment.

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.


The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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