The British pound today rallied higher against the US dollar in the European session on hopes that Brexit would be delayed. The GBP/USD had posted small gains after the release of mixed UK data where the GDP beat expectations, while manufacturing data missed estimates.
The GBP/USD currency pair today rallied from a low of 1.2709 to a high of 1.2851 following the Brexit delay rumors.
The currency pair earlier today traded with a bearish trend in the Asian session ahead of the UK macro releases. The release of the UK manufacturing production data for November triggered a brief decline by the pair as the print missed expectations. According to the Office for National Statistics, manufacturing output contracted by 0.3% in November versus the expected 0.3% growth, while the annualized print fell by 1.1% as compared to the consensus estimate of a 0.7% decline. Industrial production also contracted by 0.4% versus the expected 0.2% expansion. The trade deficit with the EU was higher than expected by coming in at 3.920 billion, while the total trade balance figure was recorded at 2.904 billion.
The cable rallied slightly boosted by the GDP estimate for November, which came in at 0.2% beating expectations by 0.1%. However, the pair shot higher after the rumors of the government delaying Article 50 were published. The pair had a muted reaction to the US CPI data for December released by the Bureau of Labor Statistics.
The currency pair’s performance over the weekend is likely to be influenced by geopolitical events.
The GBP/USD currency pair was trading at 1.2795 as at 14:27 GMT having rallied from a low of 1.2709. The GBP/JPY currency pair was trading at 138.93 having risen from a low of 137.64.
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