Forex News UK – Various economic data squeezed the Sterling

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The British Gross Domestic Product (QoQ) for the first quarter of 2011 came out in line with the forecast at 5%, the previous rate was -5%. The year over year GDP for the first quarter of 2011 came out at 1.6% declining by 0.2% from the forecasts. The economic indicator of Total Business Investment in UK both in the year over year and quarter over quarter basis came out improved, but it is still a negative number, thus it could not affect the Sterling significantly. The British Current Account for the first quarter of the present year, was released below the expectation of -4.7 billion GBP extending the deficit of the account at – 9.354 billion GBP, almost twice lower than the forecast, the previous reading was -12.956 billion GBP. The negative year over year GDP, the larger deficit in the Current Account along with the dovish BoE minutes released last week made the British pound very vulnerable and frail. Upon the announcement of the news the GBPUSD pair lost so far some 71 pips to hit a low of 1.5916 trimming all the gains from the opening of the European session. The Sterling is now trading against the Dollar at 1.5938, close to the multi month trough of 1.5912.