The British economy grew by 0.5% in the last quarter of 2017, better than 0.4% that was expected. Year over year, and in this case for the entirety of 2017, the economy expanded by 1.5% against 1.5% that was projected. This is the first release out of three.
GBP/USD was already on the up ahead of the publication, trading around 1.4250. It reached a new high of 1.4280 but hesitates.
The pound enjoyed yesterday’s extended dollar weakness to reach a new high of 1.4344 before Trump trumped up the dollar – a move that sent the pair all the way below 1.41. The recovery was related to a fresh USD sell-off that is now compounded with support from the pound.
While the UK economy has grown at a better pace than expected, its performance underperforms that of the other developed economies such as the euro-zone and the US. The UK outperformed its peers in 2016 but its numbers in 2017 are the worst in five years.
The ONS says that growth is uneven in the British economy, with weakness in those businesses that face the consumer.
Here is how the recent move looks on the pound/dollar 30-minute chart:Get the 5 most predictable currency pairs