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Sterling falls after UK GDP unexpectedly contracts in October

Published by Global Banking & Finance Review

Posted on December 13, 2024

1 min read

· Last updated: January 27, 2026

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Sterling Declines Following Unexpected UK GDP Contraction

LONDON (Reuters) - The pound fell on Friday after data showed the British economy shrank unexpectedly in October, which could prompt traders to attach a greater chance to the prospect of speedier rate cuts by the Bank of England next year.

Official data showed UK economic activity contracted 0.1% in October. A Reuters poll of economists had forecast a rise of 0.1% last month, from September's 0.1% fall.

Sterling initially fell as much as 0.3% after the numbers and was last down 0.24% at $1.2642.

(Reporting by Amanda Cooper; Editing by Harry Robertson)

Key Takeaways

  • UK GDP contracted by 0.1% in October.
  • Economists had predicted a 0.1% rise.
  • Sterling fell 0.24% to $1.2642 after the data release.
  • Potential for Bank of England rate cuts increased.
  • Economic activity was lower than expected.

Frequently Asked Questions

What is the main topic?
The article discusses the unexpected contraction of the UK GDP in October and its impact on the British pound and potential Bank of England rate cuts.
How did the pound react to the GDP data?
The pound fell by 0.24% to $1.2642 following the release of the GDP data.
What are the implications for the Bank of England?
The unexpected GDP contraction may lead traders to anticipate faster rate cuts by the Bank of England next year.

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