In London trading, the Pound Sterling continues to be pressured by a firmer greenback and earlier touched a 2½ month trough against the Dollar. Last week, the Pound suffered its largest weekly decline versus the greenback in seven weeks, with investors concerned about the Brexit transition period possibly failing to yield positive results. Analysts say that, in the absence of economic data that would otherwise drive Sterling, broader trends in the FX markets are driving sentiment. Though the latest data is positive for UK growth, the overriding sentiment remains the ability of the UK government to thrash out a favorable trade deal with the EU before the end of the year.
As of 11:14 am in London, the GBP/USD was trading higher at $1.2931, a gain of 0.3835%, with the pair moving off the earlier trough of $1.28716. The EUR/GBP was lower at 0.8468 Pence, a loss of 0.2967%; the pair has ranged from a low of 0.84666 Pence to a high of 0.85054 Pence. The GBP/JPY was trading at 141.9210 Yen, up 0.3472% and off the earlier high of 141.989 Yen.
UK Outlook for Tuesday
A slew of data will be released on the UK economy tomorrow. The potential market movers include the preliminary reading of 4th quarter GDP, which is expected to be flat on a quarterly basis, as well as December's industrial and manufacturing production figures, with analysts calling for a rise to 0.3% and -0.1%, respectively, on a monthly basis. The Governor of the Bank of England is also due to give a speech at the UK Parliament tomorrow; as usual, his words will be scrutinized for hints as to potential policy modifications.