10 July 2019
The Dollar, at a three-week high in trade-weighted terms, is holding its ground ahead of Federal Reserve Chairperson Powell’s testimony on the economic outlook and recent monetary policy actions before the Joint Economic Committee in Washington. In the first of a two-day session, Powell will first read out a prepared statement then answer questions from committee members.
The GBP/USD cross, beaten down in recent weeks, is up marginally today following the release of slightly better than expected monthly UK GDP data. GDP growth picked up to 0.3% mom in May, thanks in part to a recovery in auto production, following a 0.4% mom contraction in April. These monthly GDP data tend to be volatile but the underlying picture is still one of meek economic growth in the UK. While GDP growth in Q2 may not have ground to a halt – as recently forecast by the Bank of England – it likely slowed, potentially quite sharply from 0.5% qoq in Q1.
