The Pound Sterling (GBP) is little changed and underperforming on the session as a result, Scotiabank’s Chief FX Strategist Shaun Osborne notes.

GBP gains are capped in the low 1.31 area

“UK GDP was flat in July (below expectations of a 0.2% rise) and rose 0.5 in the July quarter (a little below forecasts of 0.6%). Details were generally softer than expected or outright weak (manufacturing).”

“The data suggest some slowing in growth momentum after a more positive H1 but do not alter near-term prospects for the BoE, with markets continuing to price in the low risk (4-5bps) of a rate cut this month.”

“Soft price action intraday continues to cap GBP gains in the low 1.31 area. More range trading seems likely in the short run, with trend signals at very weak and neutral levels. Support is 1.3050/60. Resistance is 1.3115.”