GBP rebounds on strong UK GDP, Gold lingers near lows
Gold near one-month low due to robust USD and bond yields
USD stabilizes after US inflation release, impacting rate expectations
UK GDP beats forecasts, boosting the GBP
European shares followed Wall Street’s detour as major indices settled lower overnight
Market watch of the day!
Markets price in lower-than-expected CPI data
The U.S. dollar stabilized following the recent release of consumer inflation data near 102.
The released data led to increased speculation that the Fed may keep rates unchanged in September. While others seem to think a rate cut is back on the table despite Fed officials pushing back on this idea.
In the same context, the ECB too may pause hiking interest rates in the upcoming meeting in September. The Euro also remained stable near 1.099, a shy away from the psychological level of 1.10.
UK GDP grows
The British pound rebounded due to better-than-anticipated economic growth figures from the U.K. The GBP/USD pair was last seen rising to 1.127075.
Data released this Friday showed that the UK’s GDP grew 0.5% vs 0.2% expected and -0.1% previous. Other data released from the UK today included the industrial and manufacturing production which were well above expectations signally modest recovery in the UK supporting the pound further.
Despite the positive data, European shares followed Wall Street’s detour as major indices settled lower overnight. The FTSE 100 slid 1% to 7,544 while Germany’s DAX edged lower to 15,932.
Gold prices remained close to their lowest point in a month. This week has been challenging for gold, marking its weakest performance in seven weeks, as the U.S. dollar and bond yields maintained their strength. Prices were last seen near $1917.