Today is a big day British pound Important economic information has been released as traders. All of this came as a surprise to the upside, a key development on expectations that the Bank of England will raise Bank Rate by 50bp later this week.
Perhaps the most surprising UK GDP for October. The data showed that The UK economy grew by 0.5%0.4% higher than expected.
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In addition to better-than-expected economic growth, here’s some positive economic data released today in the United Kingdom:
- Construction output m/m: 0.8% vs 0.1% expected
- Industrial Production m/m: 0.0% vs -0.1% expected
- Manufacturing output m/m: 0.7% vs -0.1% expected
How has the pound reacted to positive economic data?
The British Pound, like other major currencies, has been trading in a tight range recently for a number of reasons. First, this is the time of year when traders and investors prefer not to take chances. As December is a holiday month, trading is low due to lack of cash flow.
Second, December marks the end of the trading year. For many, the risk of spoiling the year’s performance is too much to take in a month known for its tight margins.
Finally, the focus this week is on four central banks announcing their monetary policy decisions. Among them is the Bank of England on Thursday.
Therefore, this is not the best time of the week to get into any GBP pair. Also, considering the poor cash flow, it is not the best month to trade.