Sterling falls after GDP data weaker than forecast

Friday November 23, 2007

Sterling hit session lows versus dollar on Friday and fell versus the euro after UK GDP data came in weaker than expected, fuelling expectations that the Bank of England is set to cut interest rates.

Britain's economy grew at 0.7 percent in the three months to September compared to an expected rise of 0.8 percent. Bringing annual growth to 3.2 percent compared to a forecast rise of 3.3 percent [nONS003203].

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By 0936 GMT the pound was trading at $2.0598 from $2.0628 just before the data <GBP=>. The euro was at 71.91 pence from 71.84 pence <EURGBP=>.

"The GDP data was slightly weaker than people expected. It's a slight downward revision to growth, but it's still pretty strong," said Paul Robinson, currency strategist at Barclays Capital.

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