GBP/USD: British Government slashes growth projections, sets aside £3.0 billion for Brexit: Autumn Budget


GBPUSD Movement

For the 24 hours to 23:00 GMT, the GBP rose 0.66% against the USD and closed at 1.3326.

Yesterday, the British Finance Minister, Philip Hammond, in his Autumn Statement announced that the Office for Budget Responsibility (OBR) downgraded UK’s economic growth outlook and anticipated that the nation will need to borrow sharply over the coming years.

The OBR now expects the economy to post a growth of just 1.5% this year before slipping to 1.4% in 2018, revised down from a previous estimate of 2.0% and 1.6%, respectively. Further, Hammond vowed to set aside £3.0 billion over the next two years for Brexit contingency plans.

In the Asian session, at GMT0400, the pair is trading at 1.3330, with the GBP trading marginally higher against the USD from yesterday’s close.

The pair is expected to find support at 1.3250, and a fall through could take it to the next support level of 1.3171. The pair is expected to find its first resistance at 1.3373, and a rise through could take it to the next resistance level of 1.3417.

Moving ahead, market participants would draw their attention towards the release of UK’s flash 3Q GDP numbers, to gauge the strength in the British economy.

The currency pair is trading above its 20 Hr and 50 Hr moving averages.

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