Sterling Talking Points:
- Industrial production and manufacturing output both missed market expectations.
- GBP slipped back as attention turns to UK Q1 GDP.
- UK-EU trade deficit widened in the three months to February.
The DailyFX Q2 Trading Forecast for GBP is now available.
How are Retail Traders Currently Positioned in GBPUSD and why does it matter?
Sterling Slips as UK Industrial Production Slows
GBPUSD edged backed below 1.4200 after data showed that UK production and manufacturing fell in February. The downturn leaves expectations of a 0.3% Q1 GDP print – to be released on April 27 - intact but with modest risks to the downside. The Bank of England downgraded Q1 GDP expectations to 0.3% from 0.4% recently.
Trade data released today showed the UK goods deficit widened by GBP0.2 billion with the EU and narrowed by GBP0.1 billion with non-EU countries in the three months to February 2018. Exports and imports of goods to and from the EU increased, while exports and imports to and from non-EU countries decreased, according to latest Office for National Statistics data.
GBPUSD moved lower post-release, hitting 1.41820 from a day’s high of 1.42240, despite ongoing USD weakness. The sterling trade weighted index also traded as its highest level (80.43) since June 30, 2016 and is up 3% since early March.
--- Written by Nick Cawley, Analyst.
You can contact the author via email at nicholas.cawley@ig.com or via Twitter @nickcawley1.
