British Pound (FXB) Plunges After Weak GDP

The British Pound (GBP) tumbled today after the British gross domestic product for the fourth quarter badly missed the expectations, showing a decline for 0.5% against the general forecast of a modest gain by the same rate. The year-over-year number was also very disappointing, coming out at 1.7% vs. 2.6% expected. The less significant data released today also disappointed, as the index of services for November, public finance and public sector net borrowing for the month of December all missed the expectations, although not as badly as the GDP number. As a result, the British currency traded significantly lower against all of its major counterparts in global currency markets, falling against the Euro (EUR), US Dollar (USD) and Japanese Yen (JPY). The EUR/GBP currency pair soared from 0.8555 to 0.8660s, the highest level since last November. The GBP/USD dropped from 1.5965 all the way to 1.5740s, although it has recovered some of its losses since and currently is trading just above 1.58. The GBP/JPY pair, meanwhile, fell from 131.75 to 129.60s, and currently is trying to climb back above the 130 level.