Market News
Sterling drops after surprise UK GDP contraction in April - REUTERS
LONDON, June 13 (Reuters) - Sterling fell against the dollar on Monday after data showed Britain’s economy unexpectedly shrank in April, fuelling uncertainty over how fast the Bank of England can hike interest rates to tame inflation without further hurting growth.
The pound was down 0.58% to $1.2247, its lowest level since May 16, after having already suffered two straight weeks of losses as strong U.S. inflation data boosted the greenback and expectations of monetary tightening by the U.S. Federal Reserve.
Adding to the pressure on the pound, the British government is due to present legislation to unilaterally scrap some of the rules that govern post-Brexit trade with Northern Ireland, a move which is likely to inflame a simmering argument with the European Union. (Reporting by Julien Ponthus Editing by Gareth Jones)
