A disappointing day for sterling saw it lose a little bit of ground against both the euro and US dollar as economic growth throughout the previous quarter slowed to 0.5%, below expectations of 0.6% and second quarter growth of 0.7%. A recent run of disappointing growth data from a number of industries was the cause of this “shortfall”.
Some reprieve was seen against the euro as European Central Bank (ECB) policy maker Ewald Nowotny stated that quantitative easing in the Eurozone area would last until inflation increased to 2%. Also weaker-than-expected Purchasing Managers Index figures in the US saw sterling recover some ground against the US dollar late in the afternoon after falling to the lowest level in two weeks against the dollar.
A quiet day across the markets today sees little influential economic data released. However we will have later today UK time the US Federal Reserve’s statement from its latest monetary policy meeting and given the debate on when US interest rates should/could be increased these may well affect the currency markets.