The Pound has strengthened against the US Dollar after the latest Gross domestic product data for the UK showed that the nation’s economy continued to grow in the first quarter as consumer spending increased.
According to the Office for National Statistics, GDP rose by 0.3% in the first quarter of the year, matching an estimate published in April, consumer spending increased by 0.1%, whilst inventories rose by £2.5 billion.
The Pound strengthened due to the data generating improved optimism that the UK economy is on course for a solid recovery. The economy’s return to growth prompted Bank of England governor Sir Mervyn King to say that a recovery is in sight and reinforced the bank’s decision to postpone the continuation of its quantitative easing programme.
Despite the positive GDP data the UK remains highly vulnerable to sliding back into recession. Data released yesterday showed that in April, retail sales declined by 1.3%, the biggest decline of the year. Today’s report shows that government spending was unchanged in the first quarter of the year and that exports fell by 0.8% and net trade subtracted 0.1% from the overall GDP figure.
In a separate report, the statistics office said its index of services increased by 0.6% in the first quarter from the previous three months. In March, services grew 0.2%. The ONS said there was “little evidence” that cold weather during the month had a significant effect on service industries.
Current Pound Sterling (GBP) Exchange Rates:
The Pound Sterling/US Dollar Exchange Rate is currently in the region of: 1.5074
The Pound Sterling/Euro Exchange Rate is currently in the region of: 1.1687
The Pound Sterling/Australian Dollar Exchange Rate is currently in the region of: 1.5593
The Pound Sterling/New Zealand Dollar Exchange Rate is currently in the region of: 1.8706
The US Dollar/Pound Sterling Exchange Rate is currently in the region of: 0.6643
The Euro/Pound Sterling Exchange Rate is currently in the region of: 0.8548
The Australian Dollar/Pound Sterling Exchange Rate is currently in the region of: 0.6398
The New Zealand Dollar/Pound Sterling Exchange Rate is currently in the region of: 0.5335
(As of 10:30am GMT)
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