GBP/USD Weekly Forecast – 31 July

Friday, Jul 28 2017

Events that marked the week:

Wednesday's session brought UK GDP figures. UK gross domestic product (GDP) was estimated to have increased by 0.3% in Quarter 2 (Apr to June) 2017. The growth in Quarter 2 2017 was driven by services, which grew by 0.5% compared with 0.1% growth in Quarter 1 (Jan to Mar) 2017. The largest contributors to growth in services were retail trade, which improved after a fall in the first quarter, and film production and distribution. Construction and manufacturing were the largest downward pulls on quarterly GDP growth, following 2 consecutive quarters of growth. GDP per head was estimated to have increased by 0.1% during Quarter 2 2017.

From the UK, on Friday, Consumer Confidence figures were released. GfK’s long-running Consumer Confidence Index decreased two points to - 12 in July. Four of the five measures decreased this month. Joe Staton, Head of Market Dynamics at GfK, says: “Consumer confidence across the UK has fallen to the level last seen in the immediate aftermath of the Brexit vote. The economic picture across the UK remains confusing and this mood is reflected in the Overall Index Score, which is down by five points. It’s the sharp drop in confidence about the UK’s general economy – both looking back one year and ahead one year – that is driving the fall. While there’s a small bounce in consumer views of personal finance looking ahead, that’s the only measure that’s up.

This week markets will be looking at:

Net Lending to Individuals (Monday 10:30)

Manufacturing PMI (Tuesday 10:30)

Construction PMI (Wednesday 10:30)

Services PMI (Thursday 10:30)

Official Bank Rate/MPC Official Bank Rate Votes/BOE Inflation Report (Thursday 13:00)

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