Strong UK GDP figures leave euro broadly steady against British pound

• UK Q3 and September GDP releases leave EUR/GBP little changed near 0.8350.
• At 0.7%, UK GDP growth in Q3 maintained its stronger pace.
• UK labour market figures and inflation data now take centre stage for investors.

Following the release of the United Kingdom (UK) Gross Domestic Product (GDP) figures for Q3 and September, the British Pound (GDP) is largely unchanged in Thursday’s European session. The Euro (EUR) consequently holds near 0.8350 against sterling.

Growth of 0.7% matched expectations and exceeded the 0.5% recorded in this year’s second quarter, according to the Office for National Statistics (ONS). On an annualised basis, economic growth also met forecasts at 1.9%, up from the previous reading of 1.4%.

September’s GDP rose by 0.2% month-on-month (MoM), rather than remaining flat again as forecast. Meanwhile, the August GDP reading was revised down from 0.1%.

With the Bank of England (BoE) embarking on a fresh monetary tightening cycle to curb accelerating price pressures, evidence of robust UK growth is expected to offer its policymakers some reassurance.

Next week’s releases of UK labour market figures for the three months ending September and October’s Consumer Price Index (CPI) data will be the key catalysts for sterling. Both indicators are expected to significantly influence expectations for the BoE’s monetary policy outlook.