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7 Jan 2014
GBP/USD slipping on stong US trade deficit numbers
FXstreet.com (London) - GBP/USD is sliding on positive news from US deficit numbers. The pair is currently trading at USD1.6414.
Deficit helped by declining demand for foreign oil
The US trade deficit closed more than expected in November, dropping 12.9 percent to USD34.25bn - the lowest level since October 2009. The October figure was also downward revised by USD1.3bn to stand at USD39.3bn.
The figures released by the US commerce department showed that exports rose by 0.9 percent to a record USD194.9 billion, boosted by a 5.6 percent rise in petroleum exports. Imports fell by 1.4 percent to USD229.1 billion. The fall came from a decreased US demand for foreign oil offsetting record imports of imported autos. While the bulk of the decline in imports came from foreign oil, the deficit would have still narrowed without this factor.
The record export levels will be source of encouragement ahead of fourth quarter GDP numbers. However, inventory building has helped to drive recent growth in US GDP, and the decline in imports may not be enough to offset this.
With little macro data or events on the UK leg, dollar considerations will continue to dominate the pair ahead of San Francisco Fed Chairman John Williams' speech at 19:10 GMT.
GBP/USD sliding from highs
GBP/USD has been trading in a falling wedge between USD1.6406 and USD1.6427 after hitting highs of USD1.6439 before the trade data. The pair is currently trading at USD1.6414, up 0.7 percent on the day.
Deficit helped by declining demand for foreign oil
The US trade deficit closed more than expected in November, dropping 12.9 percent to USD34.25bn - the lowest level since October 2009. The October figure was also downward revised by USD1.3bn to stand at USD39.3bn.
The figures released by the US commerce department showed that exports rose by 0.9 percent to a record USD194.9 billion, boosted by a 5.6 percent rise in petroleum exports. Imports fell by 1.4 percent to USD229.1 billion. The fall came from a decreased US demand for foreign oil offsetting record imports of imported autos. While the bulk of the decline in imports came from foreign oil, the deficit would have still narrowed without this factor.
The record export levels will be source of encouragement ahead of fourth quarter GDP numbers. However, inventory building has helped to drive recent growth in US GDP, and the decline in imports may not be enough to offset this.
With little macro data or events on the UK leg, dollar considerations will continue to dominate the pair ahead of San Francisco Fed Chairman John Williams' speech at 19:10 GMT.
GBP/USD sliding from highs
GBP/USD has been trading in a falling wedge between USD1.6406 and USD1.6427 after hitting highs of USD1.6439 before the trade data. The pair is currently trading at USD1.6414, up 0.7 percent on the day.