The UK economy grew by 0.8% in Q3, according to the first GDP estimate. Year on year, the economy grew by 1.5%. Everything came out exactly as expected.
GBP/USD traded at around 1.6200 before the publication: higher, but still hesitating to tackle the 1.63 line. It is rising a bit after the publication, to 1.6220, basically recovering the small losses it encountered just before the publication. The range is maintained.
Update: the pair is moving higher, above 1.6230. The peak a few hours earlier was 1.6245.
The UK was close to a triple dip recession early in the year, but the economy certainly picked up. Strength isn’t limited to GDP figures: the number of jobless claims and also the unemployment rate were seen dropping. PMI data showed significant strength, and these are forward looking indicators.
The recent recovery also caused Mark Carney to state that he doesn’t see a case for more QE.
In recent days, GBP/USD traded on higher ground, but this was mostly due to the weakness of the US dollar. The pound couldn’t match the strength of the euro. EUR/GBP was falling.
Resistance appears at 1.6260, followed closely by 1.63. Stronger resistance is at 1.6380. On the downside, 1.6160 provides support.
For more, see the GBP to USD forecast.
