The Pound was little moved on Wednesday after the latest GDP data for the UK widely matched economist forecasts.
According to the report released by the Office for National Statistics, gross domestic product increased by 0.7% between the third and fourth quarters of 2013. The figure matched economist forecasts and was unrevised from the preliminary estimate for GDP published at the end of January.
The report also showed that GDP in 2013 increased by 1.8% compared to 2012, a figure slightly below the 1.9% increase previously expected. Despite it being below economist predictions it was still the fastest period of growth recorded since 2007. 1.5% of the gains came from increased consumer spending, suggesting that consumers are growing more confident and have more cash in their pockets.
The data was supportive for the Pound as it showed that the UK economic recovery is progressing positively. It showed that trade was the main contributor to economic growth. The trade news will be a boost for Chancellor George Osborne who recently warned that the UK must export and invest more if the recovery was to be assured.
“This provides some hope that the recovery is gaining breadth even if, as we expect, overall growth slows during the course of this year. Note new exports were positive, but with the Pound up and Europe still fragile its persistence may be challenged,” said an economist at Deutsche Bank.
The trade figure could lead to measures being taken to soften the Pounds value; such a move would help bolster UK exports and in turn help support the economic recovery.
Pound (GBP) Exchange Rates
[table width=”100%” colwidth=”50|50|50|50|50″ colalign=”left|left|left|left|left”]
Currency, ,Currency,Rate ,
Pound Sterling,
,US Dollar,1.6669 ,
Pound Sterling,,Euro,1.2141 ,
Pound Sterling,,Australian Dollar,1.8525 ,
Pound Sterling,,Canadian Dollar,1.8496 ,
[/table]
Comments are closed.