Sterling Pound Drops on UK GDP Data and US Inflation Report

The Sterling pound today was on a downtrend from the Asian session, but recovered slightly after the release of positive UK GDP data. The GBP/USD currency pair’s decline was further accelerated by the release of upbeat CPI data from the US docket.
The GBP/USD currency pair today dropped from a high of 1.2836 in the Asian session to a low of 1.2738 in the early American session.
The currency pair headed lower in the Asian session due to the risk-off market sentiment sparked by the economic downturn in Turkey. The pair halted its decline briefly and rallied higher after the release of the UK GDP data for Q2 by the Office for National Statistics. The GDP data came in at a quarterly 0.4%, which translated into an annualized 1.3%; both prints met expectations. Other positive releases from the UK docket such as the trade balance data for June, which came in at -£8.6 billion, also boosted the pair. The manufacturing production data for June as well as the construction output both beat expectations to contribute to the pair’s brief recovery.
The release of the US Consumer Price Index report by the Bureau of Labor Statistics, which was in line with expectations served to drive the pair lower. The core CPI data beat consensus estimates by coming in at an annualized 2.4% versus the expected 2.3%.
The currency pair’s future performance is likely to be affected by geopolitical events related to Brexit and the US trade wars over the upcoming weekend.
The GBP/USD currency pair was trading at 1.2742 as at 13:41 GMT having dropped from a high of 1.2836. The GBP/JPY currency pair was trading at 141.27 having declined from a high of 142.53.

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