© Dukascopy bank SA
The GBP/USD pair experienced highly volatile trading week, but despite the strong looses managed to close on the hopeful note. On Monday, the Pound slipped lower against the Dollar, as the Greenback firmed up, after the Federal Reserve Chair Janet Yellen reiterated on Friday, that the bank is likely to start raising interest rates later this year.
By the next day, the Cable was trading at one-and-a-half week lows, even after data showed the UK economy grew more than initially expected in the fourth quarter of 2014. In a report, the UK's Office for National Statistics said, the gross domestic product expanded at a rate of 0.6% in the final three months of 2014, up from a previous estimate of 0.5% and above expectations for a 0.5% reading. Annualized GDP, in turn, grew at a rate of 3.0% in the fourth quarter, up from an initial forecast of 2.8% and beating expectations for a 2.7% increase. Data also showed that the UK current account deficit narrowed to 25.3 billion pounds in the last quarter from 27.7 billion pounds in the third quarter of 2014. Meanwhile, the Cable dipped against the Dollar on Thursday, after UK construction purchasing managers' index ticked down to 57.8 in March from February's four-month high of 60.1. However, overnight, the Dollar dropped unexpectedly, as data showed that the number of US jobless claims fell to a nine-week low of 268,000. The surprisingly weak report on labor market could prompt the Fed to delay a planned increase of interest rates. As a result, the pair closed on Friday at 1.4925 level.
In course of this working week, the votes of Dukascopy Community members are bullish, as almost 80% predict pair to decline. As for the economic news, on Wednesday, the UK is to release data on the trade balance, while later on the day, the BoE is going to announce its benchmark interest rate. The US, in turn, will publish the weekly report on initial jobless claims. On Friday, the UK is to announce data on industrial and manufacturing production.
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