The Sterling pound today crashed to fresh 2-year lows after the latest UK GDP report indicated that the country’s economy shrunk 0.2% in the second quarter. The GBP/USD currency pair was also weighed down by other weak UK macro releases including the disappointing industrial production data.
The GBP/USD currency pair today fell from an opening high of 1.2147 to a new 2-year low of 1.2056 and was trading near these lows at the time of writing.
The currency pair opened today’s session trading with a negative bias and extending its losing streak for the third consecutive session. The pair’s performance was driven by weak investor sentiment for most of the Asian session. The currency pair crashed lower following the release of the UK Q2 GDP data by the Office for National Statistics at 8:30 GMT. The country’s GDP fell 0.2% as opposed to the expected flat reading. The weak annualized UK industrial production and manufacturing production prints also contributed to the cable’s fall. However, the British visible trade balance for June, which came in above expectations, helped mitigate the pair’s losses. The monthly construction output fell 0.7%, which was more than the expected 0.4% decline.
The cable finally found a floor near its lows during the American session following the release of the mixed US producer price index data for July by the Bureau of Labor Statistics.
The currency pair’s future performance is likely to be affected by Brexit news and geopolitical events over the upcoming weekend.
The GBP/USD currency pair was trading at 1.2068 as at 14:02 GMT having crashed from a high of 1.2147. The GBP/JPY currency pair was trading at 127.66 having dropped from a high of 128.74.
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