Live Chat

Sterling rises vs. USD after UK economy beats Q1 expectations

Sterling rises after UK economy beats Q1 expectations

Pound sterling rose on Friday following the release of data indicating the UK economy surpassed expectations in the first quarter, recording a 0.6% growth and emerging from a mild recession experienced in 2023.

Sterling increased by 0.1% to $1.2537, up from $1.2516 prior to the data announcement. Although the pound has seen a slight rise this May, it has declined by 1.5% year-to-date due to the strengthening U.S. dollar driven by robust economic performance in the United States.

According to the Office for National Statistics, the UK's GDP growth for the January-March quarter was notably higher than the anticipated 0.4%, as forecasted by a Reuters poll of economists.

Henry Cook, senior economist at lender MUFG, told Reuters:

"The UK economy started the year with a bang. Recession is firmly in the rear-view mirror."

Against sterling, the euro weakened by 0.1% to 86.04 pence.

Calculate your Forex margin

Calculate your hypothetical required margin for a Forex position, if you had opened it now..

Category

Majors Search
Majors
Minors
Exotics

Instrument

Search
Clear input

Bid

Ask

Account Type

Direction

Quantity

Amount must be equal or higher than

Amount should be less than

Amount should be a multiple of the minimum lots increment

USD Down

Leverage

-

Required Margin

$-
Required margin is displayed in instrument currency

Required Margin

$-
Required margin is displayed in selected account currency

Current conversion price:

-
Start Trading

Past performance is not a reliable indicator of future results.

Bank of England stands pat on rates, signals summer cut

The Bank of England kept interest rates unchanged at a 16-year peak of 5.25% on Thursday, but noted that inflation was moving in the right direction. A second member of the Monetary Policy Committee voted in favour of a rate cut, suggesting that the Bank may move towards a potential reduction in borrowing costs in the second or third quarters.

Inflation slowed to 3.2% in March, down from a high of 11.1% in October 2022, with new data expected on May 22.

MUFG’s Cook added:

"Today's figures may give the BoE some pause for thought, but the focus will remain on key upcoming data on inflation and wage growth. Provided that these data points move in the right direction, today's good news on economic activity in isolation is unlikely to derail initial monetary easing”.

Sterling also saw a 0.2% rise on Thursday after U.S. data revealed an unexpected increase in weekly jobless claims, hinting at a potential weakening in the labour market and a possible rate cut by the Federal Reserve later this year.

Despite these movements, the U.S. dollar has advanced approximately 3.9% in 2024, buoyed by strong economic growth. The dollar index, which measures the strength of the greenback against a basket of six major currencies, remained steady at 105.23


When considering shares, indices, forex (foreign exchange) and commodities for trading and price predictions, remember that trading CFDs involves a significant degree of risk and could result in capital loss.

Past performance is not indicative of any future results. This information is provided for informative purposes only and should not be construed to be investment advice.

Latest news

Wednesday, 6 November 2024

Indices

U.S. presidential election market volatility drives Bitcoin prices to reach a historic high

Stock market rally

Tuesday, 5 November 2024

Indices

US Election Results Trigger Stock Gains Across Europe, Asia, and US

US Election Trump's victory

Tuesday, 5 November 2024

Indices

Trump Victory Spurs Market Gains and Economic Shift Expectations

Tuesday, 5 November 2024

Indices

US election: bitcoin price (BTC) surged to new record as Trump leading ahead

Live Chat