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GBPUSD started the trading week lower and continues 0.56% lower at 1.2984 as investors increase the bets for an interest rate cut by the Bank of England after the weak economic data released earlier today.
The UK GDP came in at -0.3% below the market consensus of 0.0%, disappointing investors as this was the lowest reading since June 2012. The UK Manufacturing Production contracted by -1.7% below the market consensus of -0.3% in November. Services also contracted by -0.3% while the forecast was for an unchanged figure. The Industrial Production came much weaker at -1.2% below the expectations of a flat report.
Meanwhile, dovish comments from two MPC’s members Gertjan Vlieghe and Silvana Tenreyro that they favor a rate cut even in the January monetary policy meeting added to speculation after the remarks of Governor, Mark Carney that the central bank could act immediately with 250 basis points interest rate cut if needed.
The UK GDP came in at -0.3% below the market consensus of 0.0%, disappointing investors as this was the lowest reading since June 2012. The UK Manufacturing Production contracted by -1.7% below the market consensus of -0.3% in November. Services also contracted by -0.3% while the forecast was for an unchanged figure. The Industrial Production came much weaker at -1.2% below the expectations of a flat report.
Meanwhile, dovish comments from two MPC’s members Gertjan Vlieghe and Silvana Tenreyro that they favor a rate cut even in the January monetary policy meeting added to speculation after the remarks of Governor, Mark Carney that the central bank could act immediately with 250 basis points interest rate cut if needed.
By Nikolas Papas, Market Strategist at Investingcube.com
Nikolas Papas trades with: ATFX UK.
