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Data Firms Sterling Footing

Data Firms Sterling Footing

The UK economy grew more than expected in June and although the British Pound failed to show any significant volatility, the GDP data has helped it shore up recent gains.

The expansion is consistent with the Bank of England’s forecast for a robust rebound in economic activity in 2021, which could allow for an interest rate rise in 2022. The Central bank last week effectively confirmed the market’s expectation for a 2022 interest rate rise, a development that has been met with broad-based gains in the British Pound.

As for rates, GBP/EUR continues to bounce and hover around the 1.18, EUR/USD picks up from a multi month low to trade at the 1.1735 mark whilst GBP/USD also picked itself up from a monthly low to trade this morning at the 1.3865 mark.  

Data wise, the only release of note is the Eurozone industrial production (June). A 0.2% fall in production is projected for this month, owing to supply shortages in the manufacturing sector. However, this is unlikely to impact the euro in any drastic way.

 

 

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