UK Q1 GDP Overview
The UK docket sees the final Q1 2019 GDP, which will be published later this session at 0900 GMT. The second estimate of the United Kingdom GDP growth is expected to arrive at 0.5% in the first quarter of 2019. The annualized reading is expected to confirm the first readout of 1.8% in Q1.
Deviation impact on GBP/USD
Readers can find FX Street’s proprietary deviation impact map of the event below. As observed the reaction is likely to remain confined between 10 and 40 pips in deviations up to 2.5 to -2.5, although in some cases, if notable enough, a deviation can fuel movements of up to 70 pips.
How could affect GBP/USD?
The spot could extend the fresh leg higher on a positive surprise in the GDP figures and test the 1.2700 resistance zone. On a disappointing GDP print, the GBP/USD pair could drop back below 1.2650 levels.
Technically, “nothing seems to have changed for the pair, except that the overnight pullback reinforced the prevailing selling bias at higher levels. Moreover, the pair also seems to have found acceptance below 38.2% Fibo. level of the 1.2506-1.2784 recent up-move, which sets the stage for a further near-term depreciating move. Hence, a follow-through selling now seems to accelerate the fall further towards the 1.2600 round figure mark, which if broken will indicate the resumption of the prior well-established bearish trend and turn the pair vulnerable to head back towards challenging the key 1.2500 psychological mark in the near-term. On the flip side, the 1.2700 handle now becomes immediate strong resistance and is closely followed by the 1.2720-25 confluence region – comprising of 100-hour SMA and 23.6% Fibo. level,” Haresh Menghani, Analysts at FXStreet, writes.
Key Notes
UK GDP Preview: Even a minor disappointment may weigh heavily on GBP/USD
GBP/USD: Key reversal – Commerzbank
G20 meeting: Trump and Xi meeting in focus – Danske Bank
About the UK GDP
The Gross Domestic Product released by the Office for National Statistics (ONS) is a measure of the total value of all goods and services produced by the UK. The GDP is considered as a broad measure of the UK economic activity. Generally speaking, a rising trend has a positive effect on the GBP, while a falling trend is seen as negative (or bearish).
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