The GBP/USD currency pair today rallied to new highs after the release of positive UK industrial production data by the Office for National Statistics early in the European session. The selling tone around the US dollar also contributed to the currency pair’s rally even as the US Dollar Index hit yearly lows earlier today.
The GBP/USD pair today hit new monthly highs last witnessed on August 4th as it rallied by over 120 points to hit a high of 1.3223.
The British pound’s rally was largely triggered by the release of the UK industrial production data, which exceeded expectations by recording a 0.4% increase on an annualized basis, versus the market consensus of a 0.3% gain. The manufacturing production data also contributed to the pound’s upward momentum as it came in at 1.9% on a year-on-year basis as opposed to the expected 1.7% annualized increase. The positive total trade balance data for July also boosted the pound as it was recorded at -£2,872 as compared to the expected £3,250 deficit.
The currency pair’s rally was also boosted by the selling bias on the US dollar even as investors sold the greenback in anticipation of the damage that Hurricane Irma might cause in Florida. Hurricane Irma is expected to be the most devastating storm in US history, it is even bigger than Hurricane Harvey.
Given the empty US and UK dockets on Monday, the currency pair’s future performance is likely to be affected by Hurricane Irma over the weekend and the UK CPI data on Tuesday.
The GBP/USD currency pair was trading at 1.3197 as at 14:14 GMT having rallied from a low of 1.3097. The GBP/JPY pair was trading at 142.33 having rallied from a low of 141.32 earlier today.
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