The Euro remains softer against the Pound after data showed that the UK economy expanded by 0.7% in the fourth quarter of 2013, making it the best year since the start of the global financial crisis in 2007.
According to the Office for National Statistics, the 0.7% figure marked the first time since 2007 that every quarter posted growth. The fourth quarter increase follows the 0.8% increase seen in the third quarter.
The data widely matched economist forecasts and buoyed market optimism that the UK economy will continue to improve in 2014. Some economists are now forecasting that the nation’s economy will strengthen by 3% this year.
“With business surveys, such as the purchasing manager’s indices and the British Chambers of Commerce reports indicating very strong activity across the economy it looks as though there is significant momentum at the beginning of 2014. Employment continues to rise robustly, housing activity is very firm, confidence is on the rise, credit growth is improving and the UK’s key export mart- the Eurozone is showing some encouraging signs,” said an economist at ING.
Supporting that idea was the release of consumer confidence data out of France which showed a better than forecast rise from 84 to 86 in January.
Sterling is likely to be supported by the GDP data for most of the week as confidence continues to rise.
“We have now seen four successive quarters of significant growth and the economy does seem to be improving more consistently. Today’s estimate suggests over four fifths of the fall in GDP during the recession has been recovered, although it still remains 1.3% below the pre-recession peak,” said ONS chief economist Joe Grice.
Euro (EUR) Exchange Rates
[table width=”100%” colwidth=”50|50|50|50|50″ colalign=”left|left|left|left|left”]
Currency, ,Currency,Rate ,
Euro,,US Dollar,1.3635 ,
Euro,,British Pound,0.8238 ,
Euro,,Australian Dollar,1.5500 ,