GBP retreats as UK economy falters due to higher interest rates – Crypto News – Crypto News
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Retreats towards 1.1800 but bears have a bumpy road ahead Retreats towards 1.1800 but bears have a bumpy road ahead

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GBP retreats as UK economy falters due to higher interest rates – Crypto News

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GBP/USD outlook: Sterling was hit further by weak UK GDP data, but key support still holds

GBPUSD was down over 40 pips this morning in immediate reaction to weaker than expected UK GDP data.
The price fell to the lowest in more than three months, attempting to break out of the recent four-day consolidation and pressuring pivotal 200DMA support.

The data released earlier this morning showed that Britain’s economy contracted at the fastest pace in 2023 (GDP m/m July -0.5% vs 0.5% in June and -0.2% f/c; annualized 0.0% July vs 0.9% in June). Downbeat GDP numbers further sour the sentiment after labor data on Tuesday also fell below expectations, adding to concerns as Bank of England holds its policy meeting next week. Read more…

Pound Sterling retreats as UK economy falters due to higher interest rates

The Pound Sterling (GBP) remained offered on Wednesday as the UK’s Office for National Statistics (ONS) reported that the economy shrank by 0.5% in July and factory activities contracted significantly due to a deteriorating demand outlook. The GBP/USD pair witnessed an intense sell-off as higher interest rates by the Bank of England (BoE) triggered an economic slowdown and firms remain reluctant to full-capacity utilization.

After significant layoffs and weak factory activities in July, it is evident that the UK economy is failing to absorb the burden of restrictive monetary policy. Meanwhile, strong wage momentum has boosted upside risks to inflation and warrants more interest rate hikes from the BoE to contain the highest inflation among G7 economies. Read more…

GBP/USD Analysis: Bears await break below 200-day SMA pivotal support, focus remains on US CPI

The GBP/USD pair remains under some selling pressure for the second straight day on Wednesday and hits a fresh multi-month trough, around the 1.2440 area during the early European session. The British Pound (GBP) is undermined by the disappointing data, showing that the UK economy shrank at the quickest pace in seven months. The Office for National Statistics reported that Britain’s Gross Domestic Product (GDP) contracted more-than-expected, by 0.5% in July, suggesting that the UK economy is losing momentum in the wake of a sharp rise in borrowing costs and reviving recession fears. This comes on top of signs that the UK labour market is cooling and reaffirms speculations that the Bank of England (BoE) is nearing the end of its rate-hiking cycle. Read more…

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