Britain’s June GDP rose 0.3% month-on-month, beating forecasts, but temporary factors drove the gain as GBP/USD holds near 1.3500.
The British pound edged higher after UK GDP data showed a 0.3% monthly rise in June, exceeding expectations of no growth. The year-on-year rate reached 1.2%, slightly above the 1.1% forecast, while the quarterly rate matched consensus at 0.4%. Services sector growth, driven by a temporary Gulf ceasefire, the World Cup, and favorable weather, accounted for the surprise.
GBP/USD climbed roughly two cents in August, reclaiming the 1.3400 level where its 50-day and 200-day EMAs converge. The pair tested 1.3550 but failed to break higher, reflecting muted market reaction to both the UK growth beat and softer US inflation data. Trading ranges remained tight, with sterling holding just below 1.3500.
The upside in June’s GDP was tied to one-off events unlikely to repeat, including the now-collapsed Gulf ceasefire. Talks on reopening the Strait of Hormuz remain deadlocked, adding uncertainty to future trade flows.