By Connor Campbell, Financial Analyst, Spreadex
The pound continued to look a bit pale this Thursday ahead of the second estimate UK Q2 GDP reading.
Cable slipped 0.1% after the bell, keeping the pound below $1.28 and at its lowest price in just shy of a month. Though sterling technically fared better against the euro, rising 0.1%, the currency is still in serious trouble against its eurozone peer, trapped under €1.085. Given the near uninterrupted fall the pound has seen against the euro since July, the threatening figure of parity has begun to appear on the horizon
Sterling’s continued woes allowed the FTSE to eke out a bit more growth, the UK index climbing 15 points to a one week, 7400-plus high. Now it just needs to keep going, something it hasn’t been able to do with any confidence since the North Korea-inspired plunge at the start of the month.
All this could change, however, dependent on the state of this morning’s GDP reading. Analysts are expecting the second quarter figure to come in unchanged at a paltry 0.3% – a surprise revision could make a bad week for the pound worse, or help the currency lift away from its recent lows. Also worth paying attention to is the quarterly preliminary business investment figure, which is forecast to fall from 0.6% in Q1 to 0.2% in Q2 – again, not exactly the kind of news sterling wants to hear right now.
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