Anna 
The pound strengthened against the dollar, gaining 0.1% to 1.2534 on Friday, rebounding from its recent lows observed on Thursday, following the release of strong economic data showing Britain’s economy experienced its most significant growth in nearly three years during the first quarter of 2024.
The U.K. gross domestic product (GDP) expanded by 0.6% in the three months to March, marking the strongest growth since the fourth quarter of 2021 and signaling the country’s exit from the shallow recession it faced in the second half of last year.
In monthly terms, the economy saw a 0.4% growth in March, surpassing the forecast of 0.1% growth.
While the Bank of England maintained interest rates at a 16-year high in its recent meeting, two members of the nine-person Monetary Policy Committee voted for a rate cut, indicating a shift towards potential monetary easing.
Meanwhile, the euro-dollar pair (EUR/USD) traded relatively unchanged at 1.0783 amid a light data calendar that provided little direction.
The European Central Bank (ECB) has hinted at a rate cut expected on June 6, although uncertainties remain regarding the extent of future rate cuts for the remainder of the year.
Belgium’s central bank governor, Pierre Wunsch, advocated for further policy adjustments earlier this week, cautioning that prolonged tight policy could pose a greater risk compared to easing measures implemented sooner.
Currently, markets are pricing in approximately 70 basis points of rate hikes for the year ahead.
