Sterling remains weak despite upward GDP revision

Analysts expect sterling to remain 'pressured', despite the upward revision in the UK's gross domestic product (GDP) data.

The upward revision to show that the UK experienced 0.3 per cent growth in the fourth quarter of 2009 was not enough to alleviate traders' persistent worries concerning the strength of the country's economy.

A brief rise against the euro and the dollar was seen at around 09:30 GMT this morning (Friday February 26th) following the release of the GDP figures from the Office for National Statistics.

However, the currency tumbled later in the day, until by 13:00 GMT one pound only bought $1.51.

Michael Hewson, an analyst from CMC Markets, told Reuters news agency: "The headline figure was quite positive, but if you dig a little deeper, the third quarter was revised lower and the year-on-year figure was revised lower still."

He added that sterling was likely to "remain weak as nothing fundamentally has changed".

"These figures merely confirm that the economy is fairly weak at the moment and the pound will be susceptible to structural weaknesses in the UK economy," Hewson said.

Posted by Thomas Smith

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