Sterling appears to be in the driver's seat this morning after seeing nearly one percent of losses in the GBP/USD pair come Wednesday’s session close.
Having opened at 1.207, GBP/USD added 30 pips to 1.210 in the opening Asia trading hours.
However, with gross domestic product (GBP) growth in the UK coming in considerably weaker than expected in this morning’s reading, we could expect to see a Cable contraction as investors capitulate on recession worries.
With the FTSE 100 expected to make further gains throughout the day, a Cable bet could be even riskier.
Yearly GDP growth in the year’s final read was 1.9% compared to the 2.4% forecast, while quarter-on-quarter GDP growth of -0.3% beat out expectations of -0.2%.
Will investors capitulate on the pound? – Source: capital.com
The US has its own GDP reading due later this afternoon, with QoQ growth of 2.9% forecast.
EUR/GBP was sitting at a five-week high after gaining 0.8% yesterday to close at 87.83p. Despite inching back to 87.81p this morning, the euro still appears to have the upper hand.
The euro has already recouped the 17 pips it ceded to the dollar in Wednesday's session, with the EUR/USB pair rising 0.3% to 1.063 so far this morning.
The US Dollar Index (DXY) is currently sitting 0.3% lower at 103.57.