Pound Rallies on Upbeat UK GDP Report, Falls Ahead of Brexit Vote

The Sterling pound today inched higher against the US dollar boosted by the release of the upbeat UK Q3 GDP data in the early London session. The GBP/USD currency pair barely reacted to the appointment of a new Bank of England Governor, which was expected by most analysts and investors.
The GBP/USD currency pair today rose from an opening low of 1.3007 to a high of 1.3048 in the mid-London session and was near these highs at the time of writing.
The currency pair rallied from the start of today’s session amid optimism that the new Conservative Party government will fast-track the Brexit process. News reports indicated that the British government wants to pass its Brexit bill by January 9th giving MPs only three days to debate and pass the bill. The release of the upbeat UK Q3 GDP report by the Office for National Statistics also boosted the pair. The country’s GDP grew by 0.4% in Q3, beating analysts expectations of a 0.3% expansion. The public sector borrowing report released at the same time also beat consensus estimates contributing to the pair’s gains. Investors barely reacted to the appointment of Andrew Bailey as the next BoE Governor as this was expected.
The currency pair’s rally was limited by Boris Johnson‘s announcement that the Withdrawal Agreement Bill does not have a provision for an extension of the Brexit talks past December 2020. Johnson said that the move will strengthen the UK’s negotiating position.
The cable’s short-term performance is likely to be affected by the outcome of the House of Commons vote on the bill at 15:00 GMT.
The GBP/USD currency pair was trading at 1.3025 as at 12:10 GTM having fallen from a high of 1.1048. The GBP/JPY currency pair was trading at 142.44 having dropped from a high of 142.75.

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