GBP/USD: Sterling Resumes Upswing to Challenge $1.36 After UK GDP Slows but Tops Estimates

UK currency got a shot of early-Thursday espresso after the quarterly GDP data showed 0.3% expansion. Pace was relatively slow, but still topped consensus views.

💷 Pound Seeks to Extend Winning Streak

• The GBPUSD pair climbed to $1.3590 Thursday, up about 0.2% on the day, putting it on track for its ninth daily gain in the past ten sessions as traders welcomed better-than-expected growth figures.
• The UK economy expanded 0.3% in the second quarter, slowing from 0.7% in the first one, but beating consensus calls for just a 0.1% rise.
• The move leaves sterling well above its 200-, 100-, and 50-day SMAs, a technical alignment that reinforces bullish momentum in the currency.

📊 Double Top in the Works?

• The quarterly expansion, while modest, highlights economic resilience despite ongoing cost-of-living pressures, tighter financial conditions, and tariff jitters (because, of course, they're everywhere).
• Economists had braced for near-stagnation, but stronger household spending and services output helped the UK avoid a bigger slowdown.
• The upside surprise adds to recent positive data points that have fueled sterling’s August rally. The currency is up 3.5% against the US dollar since August 4 and is struggling to break above a potential double-top formation at current market prices.

🏛 Fiscal Challenges Loom

• Chancellor Rachel Reeves called the figures “positive” but acknowledged “there is more to do” to build an economy “that works for working people.”
• Reeves faces an estimated £20 billion fiscal hole, which economists warn may require fresh tax increases in the Autumn Budget.
• The GDP beat may buy the chancellor some political breathing room, but markets remain alert to policy signals that could affect growth and sterling’s trajectory into year-end.