Sterling Slides as Britain’s Growth Loses Momentum

The Great Britain pound fell today against its other major peers as Britain’s economic growth in the third quarter of this year was disappointing, reducing chances for an interest rate hike in the near future.

Office for National Statistics reported that the UK economy grew 0.5 percent in the September quarter from the previous three months. This is compared to the prior quarter’s growth of 0.7 percent and the increase of 0.6 percent forecast by economists. On top of that, other economic data released today was also disappointing as growth of the Index of Services also trailed expectations.

It looks like Britain’s economic growth is steadily losing momentum. It is hard to imagine that the Bank of England will decide to start monetary tightening under such circumstances, meaning that the sterling has lost support for interest rate hike expectations.

GBP/USD dropped from 1.5348 to 1.5303 as of 21:26 GMT today. GBP/JPY declined from 185.72 to 184.17. EUR/GBP edged up from 0.7199 to 0.7215.

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