Weekly Roundup: Pound wavers near lows amid bleak UK outlook
Amy Richards October 2nd 2023 - < 1 minute read
The pound started the week on the back foot following a gloomy UK economic forecast from accountancy giant KPMG, with the firm predicting slowing growth through 2023 and 2024.
Ratings agency S&P Global Ratings released its economic outlook on Tuesday, with the forecast echoing KPMG’s. This put further pressure on the pound.
After wavering midweek, Sterling then found fleeting success as falling mortgage rates raised hopes that the UK’s cost-of-living crisis could be beginning to ease. However, Sterling couldn’t sustain the upside.
More volatility hit GBP on Friday. Although first-quarter GDP was revised up from 0.1% to 0.3%, economists warned that the UK still faces a recession.
The coming week could see Sterling continue to fluctuate near recent lows amid a shortage of UK data.
The only release of note will be the final services PMI. If it confirms a steep contraction in service-sector activity, the pound could face selling pressure.