Sterling dropped after Current Account
Important announcements were released in the U.K. U.K's Current Account was recorded with a deficit of 9.4 billion Pounds in the first quarter of 2011. Economists were widely off, as predictions were expected at 5.0 billion Pounds; whereas a 10.5 billion Pounds was previously recorded quarter.
Current Account measures the difference in value between imported and exported goods, services, unilateral transfers and income flows during previous quarter; traders are widely interested and consider this news highly important as a rising surplus indicates that foreigners are buying more of the domestic currency to execute transactions in the country.
Final Gross Domestic Product remained steady as expected at 0.5%.
The Great British Pounds dropped as news announcements were recorded. Half an hour prior to the release GBP/USD was rising slowly but steadily; rising by only 10 pips in half an hour, the pair shot down to 1.5965 as soon as the U.K news were released. The pair is continuing the downfall, reaching 1.5920.
EUR/GBP rose before the release from 0.8939 to 0.8950 and to 0.8963 after the release. Most major currencies have gone up against the British Pound; GBP/CHF dropped drastically from 1.3326 to 1.3277.
