ExchangeRates.org.uk - On Thursday, the Pound (GBP) weakened against most of its major trading partners following the Bank of England's latest interest rate announcement.As anticipated, the central bank maintained interest rates at 4.75%.
However, the decision was not as unanimous as expected, with three out of nine Monetary Policy Committee members voting to reduce rates to 4.5%.
This surprising dovish divide within the committee caused the Pound to drop significantly against nearly all of its counterparts, even though a rate hold was widely anticipated.
The US Dollar (USD) softened against the majority of its peers on Thursday following the publication of a two economic data releases from the US.
Firstly, the US’s latest GDP reading exceeded market expatiations, and rose from 3% to 3.1% rather than falling to 2.8% as expected.
However, the US’s latest initial jobless claims survey plunged below forecasts during the second week of December, which saw the ‘Greenback’ experience severe headwinds throughout the second half of Thursday’s European session.
GBP/USD Exchange Rate Forecast: UK and US Data in the Spotlight
Looking ahead, the primary catalyst of movement for the Pound Euro exchange rate on Friday will likely be the publication of some economic data from both the UK and the US.
The UK will release its latest retail sales data while the US will release its latest US core PCE price index.
November’s retail sales figures are expected to surge from a previous -0.7% to 0.5%, which could give GBP exchange rates a strong finish to the week.
Similarly, the US will release its latest core PCE price index for November, which is also expected to tick up, which could see the ‘Greenback’ catch bids at the week draws to a close.
This content was originally published on ExchangeRates.org.uk