Forex▲ Bullish
Pound Holds Near 13-Month High After UK GDP Beats Forecasts
UK GDP rose 0.4% in May, double forecasts, pushing BOE rate-cut bets lower and keeping GBP/EUR near a 13-month high at €1.1794.
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The Pound to Euro exchange rate held just below a 13-month high on Thursday after UK GDP figures came in stronger than expected, reinforcing Sterling's recent run. GBP/EUR traded around €1.1794, little changed on the day.
The UK economy grew 0.4% in May, double the 0.2% consensus estimate, the Office for National Statistics reported. The print followed a flat reading in April and marked the fastest monthly expansion since January. Services output drove the gain, rising 0.3%, while construction jumped 1.9%.
The data gives the Bank of England more room to hold rates steady at its August meeting. Markets had priced in roughly a 50% chance of a cut before the GDP release; that probability edged lower after the numbers landed. A later start to BOE easing would keep the rate differential with the euro zone tilted in Sterling's favour, traders said.