UK recovering out of recession
Written by
Daily Currency Update
The UK appears to be emerging from recession with this morning's GDP figures revealing growth for the second consecutive month in February, signalling a clear path toward recovery from the economic downturn.During the last stretch of 2023, the UK economy experienced a contraction while sterling battled against mounting inflation. However, in the three months leading up to February, GDP saw a modest expansion of 0.2% when compared to the preceding two months.
Key Movers
The euro might face significant strain as speculation mounts that the Federal Reserve could refrain from cutting rates throughout the year, or if it does, it might only do so late in the final quarter. Any additional decline in the euro's value could potentially trigger an uptick in inflation.Despite inflation nearing the Central Bank's 2% target, Christine Lagarde refrained from succumbing to the urge to reduce rates at the latest meeting. Acknowledging the economy's persistent weakness in the first quarter, she opted for caution.
Expected Ranges
- GBP/USD: 1.2455 - 1.2535 ▼
- GBP/EUR: 1.1705 - 1.1745 ▲
- EUR/USD: 1.0635 - 1.0695 ▼