With the news last week that the UK Economy contracted by 0.4%, why did the pound to lose value even though the FTSE increased on the news?
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With the news last week that the UK Economy contracted by 0.4%, why did the pound to lose value even though the FTSE increased on the news?
They were expecting a positive number, showing the economy to be out of recession. Things are worse than expected, worse than other currencies/countries, and will take longer to improve. They will also probably have to increase the stimulus money. Thus the depreciation in the GBP.
Interest rates will not be raised as soon as thought, so the FTSE rallied on that news.