RTTN: Pound Rises To Multi-day Highs Against Most Majors On Strong U.K. Q2 GDP
(RTTNews) - The British pound advanced to multi-day highs against most major currencies during Friday's early European deals as a report showed that U.K.'s second-quarter GDP growth
came in well above market expectations.
The U.K. economy expanded at a faster pace of 1.1% sequentially in the second quarter, following an increase of 0.3% in the previous quarter, the Office for National Statistics reported today. The second quarter growth far exceeded the expected 0.6% increase.
However, U.K. stocks declined today as investors remained cautious ahead of the European bank stress test results due
later in the day.
At 5:32 am ET, U.K's benchmark FTSE 100 index fell 17.93 points or 0.3% at 5,296.34.
The pound has been extending its previous session's rally against the dollar and the yen during Friday's early European deals. Presently, the pound is trading at a 1-week high of 1.5403 against the dollar and 134.17 against the yen, compared to yesterday's closing quotes of 1.5258 and 132.69, respectively.
On the upside, the pound may target 1.547 against the dollar and 135.9 against the yen.
Against the franc, the pound is now trading at a 2-day high of 1.6084 with 1.617 seen as the next upside target level. The pound was worth 1.5913.against the franc at yesterday's close.
The pound advanced against the 16-nation currency in early European session on Friday. Currently, the pound is worth 0.840 against the euro, compared to 0.8454 hit at yesterday's close. The pound may target around the 0.838 level, if it gains further.
The Munich-based Ifo Institute for Economic Research said its business climate index for German rose to 106.2 in July from 101.8 recorded in June. Economists had forecast a decline to 101.5.
Amid the report, the euro gained slightly against the pound, but it pared gains shortly.
The results of the European bank stress tests will be out by 4:00 pm ET. The stress tests, conducted by central banks and coordinated by the Committee of European Banking Supervisors, include a total of 91 of the biggest banks, representing 65% of the European industry.
The tests are designed to help shore up confidence in the financial sector that has been plagued by fears of bad balance sheets, following Greece's near-default earlier in the year. Greece managed to weather the storm with the help of a EUR 110 billion rescue package from the E.U. and the International Monetary Fund.
There are no market moving data due from the U.S today.
