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Could UK gross domestic product data encourage pound gains?

business-articlesCould UK gross domestic product data encourage pound gains?
  • Pound to benefit from steady UK growth
  • Weaker trade conditions could weigh on Canadian dollar
  • New Zealand dollar looks for boost from card spending data
Steady UK growth to offer pound boost
Fresh volatility is likely to be in store for the pound this morning on the back of the latest UK gross domestic product data.
Forecasts point towards growth holding steady at 0.6% on the quarter in the final three months of 2018, suggesting that the economy is shrugging off Brexit-based uncertainty.
Even though 0.6% growth is still below the economy’s long-running average this could give GBP exchange rates a fresh rallying point.
However, any signs that the economy is losing momentum may weigh heavily on the pound.
Canadian dollar vulnerable ahead of trade data
In the wake of Friday’s unexpectedly positive labour market data the Canadian dollar may struggle to hold onto a positive footing today.
While December’s Canadian trade balance is expected to show a modest narrowing of the deficit on the month this may not be enough to shore up CAD exchange rates.
Signs that export volumes weakened on the month could encourage investors to sell out of the Canadian dollar, with confidence in the economic outlook already limited.
Another weak day for the oil market could also see CAD exchange rates come under pressure.
Higher card spending to support New Zealand dollar
The New Zealand dollar may find a rallying point this evening if retail card spending figures show a rebound on the month.
After December’s disappointing spending data NZD exchange rates could see a solid boost if consumers increased their spending at the start of the new year.
Any signs of improved sentiment among consumers may fuel confidence in the outlook of the New Zealand economy, in the short term at least.
Even so, as long as the US-China trade dispute continues to weigh on market sentiment NZD exchange rates may struggle to gain much traction.
Upcoming Data:
Monday, 11th February 2019
09:30 GBP Gross Domestic Product
13:30 CAD Trade Balance
21:45 NZD Retail Card Spending
Philip McHugh

Philip McHugh

Joining the corporate trading desk in 2007, Phil now over sees all of Currencies Direct’s corporate dealing activity. Having gained experience working with hundreds of businesses to optimise international payments processes and execute comprehensive risk management strategies, Phil currently works with a portfolio of corporate clients whilst managing Currencies Direct’s overall market exposure

Phil has FCA approval and has completed the Certificate in International Treasury Management (CertiTM)

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