The Pound Sterling to Euro (GBP/EUR) exchange rate firmed on Friday following the release of data, which showed that UK construction output increased more-than-forecast in March. The Pound Sterling to US Dollar (GBP/USD) exchange rate softened as investor attention turned to upcoming US data releases.
The Pound Sterling to Euro (GBP/EUR) exchange rate reached a session high of 1.3869
According to the data released by the Office for the National Statistics (ONS), British construction output rallied in March, suggesting that the sectors recent run of weakness could be ending. The report also showed that private-sector house building rose for the first time in six months.
Construction output rose by 3.9% in March to beat economist expectations after dropping by 0.3% in February, a smaller increase than earlier estimates. On a year-on-year basis, construction output increased by 1.6%, beating economist forecasts for a rise of 1.1%, and was a strong improvement on the -0.25% recorded previously.
Construction makes up about 6% of Britain’s economy. The ONS said that combined with an upward revision to first-quarter industrial output data released on Tuesday; Friday’s new data could push up April’s 0.3% estimate of GDP growth by just under 0.06 percentage points.
‘There now looks to be a very good chance that gross domestic product growth in the first quarter will be revised up to 0.4% quarter-on-quarter from 0.3% quarter-on-quarter…although much will obviously depend on any revisions to growth in the dominant services sector which is currently put at 0.5% quarter-on-quarter,’ said Howard Archer, chief economist at IHS.
Next week the GBP/EUR exchange rate is likely to strengthen further as market attention will turn to Greece and concerns over the nation’s future in the Eurozone.
The Pound Sterling to US Dollar (GBP/USD) Exchange Rate Slips to Session Low Of 1.5733
The Pound Sterling to US Dollar (GBP/USD) exchange rate eased from its best level in six-months on Friday as the US currency recovered from the previous sessions mixed economic data releases. Jobless claims data came in better than expected on Thursday but strong gains from the report were restrained as a separate producer price index report showed that producer prices made the largest drop since 2010.
The weak inflation data caused investors to speculate that the Federal Reserve will choose to hold off on hiking interest rates until the US economy improves .