GBPUSD, Daily
UK Q3 GDP was unexpectedly been revised higher in the third release of the data, to 0.6% q/q growth from 0.5% q/q, though the y/y figure was nudged downward, to 2.0% from 2.2% previously estimated. Q1 and Q2 growth were also revised lower, to 0.3% q/q and 0.6% q/q, down for 0.4% and 0.6%, respectively. Growth of 1.0% q/q in the predominant service sector drove the q/q expansion in the economy in Q3, helping mask one or two worrying signs, including a 0.4% drop in business investment and a0.6% erosion in disposable incomes. The revisions in the data also showed that the UK economy grew at exactly the same rate in the three months after the referendum as in the three months before. Additionally the UK’s current account deficit rose to £25.5bn in the third quarter from £22.1bn in the previous three months, and although the figure is less than the £27.45bn expected by economists, it means that the deficit is now 5.2% of GDP compared to a previous 4.6%.
Creeping price pressures, caused by the weaker pound and which most economists expect will erode real incomes of households, and Brexit-related uncertainty, which is also ready suppressing business investment, suggests 2017 will be a challenging year for the UK economy. GBPUSD looks to be drifting down sub 1.2200 again (RSI, MACD, Parabolic SAR and Bollinger bands all agree) to the next support at 1.2160 and then possibly 1.2085.
Want to learn to trade and analyse the markets? Join our webinars and get analysis and trading ideas combined with better understanding on how markets work.
Click HERE to register the next webinar will start in:[ujicountdown id=”Next Webinar” expire=”2016/12/28 11:00″ hide=”true” url=”” subscr=”” recurring=”” rectype=”second” repeats=””]
Stuart Cowell
Market Analyst
HotForex
Disclaimer: This material is provided as a general marketing communication for information purposes only and does not constitute an independent investment research. Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of buying or selling of any financial instrument. All information provided is gathered from reputable sources and any information containing an indication of past performance is not a guarantee or reliable indicator of future performance. Users acknowledge that any investment in FX and CFDs products is characterized by a certain degree of uncertainty and that any investment of this nature involves a high level of risk for which the users are solely responsible and liable. We assume no liability for any loss arising from any investment made based on the information provided in this communication. This communication must not be reproduced or further distributed without our prior written permission.
